The government has ordered Somerset Council to get its finances urgently in order following a damning independent report.
The Chartered Institute of Public Finance and Accountancy (CIPFA) carried out an independent review of the council's finances, with its findings being made public before a meeting of its audit committee on May 28.
The report identified numerous concerns around the council's leadership and organisational culture, branding its financial management "weak" and awarding the council one out of a possible five stars.
The Ministry of Housing, Communities and Local Government (MHCLG) has now piled pressure on the council to sort out its financial issues, issuing a 'best value notice' on Wednesday morning (July 15).
This comes as the council approved the appointment of Elizabeth 'Lizzie' Watkin as its new chief financial officer, who will be responsible for ensuring the council can balance its books at its next budget in February 2027.
Here's everything you need to know:
What is a 'best value notice'?
Under the Local Government Act 1999, local authorities must comply with a 'best value duty' - essentially a series of standards which ensure they are providing value for money to local taxpayers.
A 'best value notice' is a formal warning from the government that Somerset Council is not meeting these standards and urging it to take action.
It does not mean that commissioners will be sent in to run services or financial support secured at the budget in February will be withdrawn.
However, given that the council has received exceptional financial support for three consecutive years - and has already been warned that it will not get a fourth round of support - it still serves as a stark, final warning for the council.
What did the notice say?
James Blythe, deputy director of local government stewardship and interventions, laid out the reasons for the notice in a letter to the council's chief executive Duncan Sharkey, which was subsequently published in full on the council's website.
Mr Blythe said that ministers "remain concerned" about the speed at which the council is turning its financial situation around, despite acknowledging that some initial progress had been made.
He went on to reference the CIPFA review, stating that the council remained in "a fragile financial position", "requires urgent action" to manage demand for services more cost-effectively, and should "accelerate the scope and pace of transformation".
Mr Blythe said that the council had "engaged constructively with MHCLG about the challenges it faces", including during an official department visit in April, and laid out a series of steps it needed to take to turn thing around.
These include implementing the findings of both the CIPFA review and the recent external audit, delivering "tangible improvements" through transformation, and strengthening its management of key services, including children's services and adult social care.
The council must provide "regular written updates" to MHCLG on its progress, and the notice will remain in place until further notice, being initially reviewed in July 2027.
How has the council's leadership reacted?
Council leader Bill Revans made a statement on the notice when the full council in Bridgwater on Wednesday afternoon (July 15).
He said: "This is a serious step. It represents the highest level of government concern short of formal intervention; we accept that, and we will respond positively and constructively.
"This does not come as a surprise. We have been transparent about the financial concerns and pressures facing this council and the scale of the challenges we face.
"We have already established an improvement advisory board to provide challenge, support and oversight of our improvement journey. This will unlock welcome additional support from the government and through the Local Government Association - though this will not involve any money.
"We remain completely responsible for making decisions locally and delivering services for the people of Somerset.
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"We have been open about the scale of the challenges facing this council. Demand for services continue to rise, costs continue to increase, and this notice rightly reflects the concern not only about financial resilience but also the need to accelerate improvements in services.
"We know there is much more work to do to strengthen our finances, governance, transformation and service performance. While progress has been made, we have never been complacent and never will be.
"I have said for some time that the way local government is funded is broken. This does not diminish our responsibility to improve, and we accept that responsibility."
Who is responsible for sorting this out?
Coincidentally, this notice came before the same meeting where the council approved the appointment of its new chief financial officer (also known as a Section 151 officer).
Elizabeth Watkin will formally take over the management of the council's finances on July 31, replacing interim post-holder Clive Heaphy.
Deputy leader Liz Leyshon told the full council: "This is one of the most significant appointments we can make.
"The role provides an oversight for financial governance, advises elected members and officers on financial matters, ensures the robustness of budgets and reserves, and has specific legal duties to report concerns regarding unlawful expenditure.
"Maintaining interim arrangements indefinitely presents risks to our organisation. Securing permanent leadership in this role is considered essential."
Ms Watkin previously held key finance posts at Taunton Deane Borough Council and South Somerset District Council, and most recently served as chief financial officer for Wiltshire Council.
How have the opposition parties reacted?
Councillor Diogo Rodrigues, leader of the Conservative opposition group, welcomed Ms Watkin's appointment but said the notice was a damning indictment of the council's slow progress on financial matters.
Mr Rodrigues (who represents the Bridgwater East and Bawdrip division) said: "We are in a darn mess - that's where we are. That’s a more transparent way of putting the position that we are in across.
"I welcome the appointment of Lizzie, and I do wish her success in the role. It's an important position and we need stable financial leadership.
"I just hope that she's here for a little longer than the last permanent appointment. It is worth noting that this will be the sixth person to be appointment to this role in just over four years.
"Residents will rightly ask what value for money are we getting - it's a fair question to ask, given the £250,000 price tag.
"I sincerely hope our new chief finance officer succeeds. She has an incredibly important and difficult job ahead of her, more difficult than she would have expected when she took on the role, and we look forward to working with her."
Councillor Leigh Redman, who leads the opposition Labour group, said that this was "a serious matter" and said the council needed to act quickly rather than indulging in "political point-scoring".
Mr Redman - who represents the Bridgwater North and Central division - said: "Local people rightly expect a council that is financially sustainable, well-governed and focused on delivering effective services.
"The notice reflects concerns that need to be addressed, but it also provides a clear framework through which the council can demonstrate progress and improvement.
"It is important that we acknowledge those challenges while remaining focused on the work needed to move forward.
"This should not be viewed as a moment for political point-scoring. Instead, it should bring members of all political groups, officers and partners together with a shared focus on strengthening the council and maintaining public confidence."
What happens next?
A more formal report into the best value notice will come before the council's executive committee at its next meeting on August 5.
Further reports on the council's finances will be published in the coming months, including its initial budget proposal and planned changes to its council tax support scheme.
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