EXCLUSIVE: Southampton City Council Warned Of Bankruptcy By Chief Financial Officer Who Left Immediately After

And the Council Chief Executive Officer declines to comment...

by Andrew D Pope*, 25th February 2023

Andrew Pope, former Independent Councillor

Southampton City Council is in a financial crisis and the captain has just left the boat after telling everyone that it is sinking. But the rats are still on board.

At its annual Budget meeting on Wednesday 22nd February 2023, Labour-run Southampton City Council was warned that it was near bankruptcy, in a "precarious" financial position and was spending unsustainably. 

The warnings came in the report to elected councillors by the Chief Financial Officer (a.k.a. Executive Director Finance and Commercialisation [S151]) John Harrison, who Southampton Independents can exclusively reveal has now left the Council, just days after signing off the reports that were presented to councillors. Mr Harrison's departure, confirmed by his LinkedIn page, seems to have been immediately after his warnings. Nevertheless, his name appeared at the top of the report to councillors, as shown on the Council's own website. 

So was the ship sinking? Or was it not sinking? Mr Harrison would also have signed off the Section 25 under the Local Government Act 2003, a very grave duty for an Officer of a Council. 

The report to councillors states:

"The Chief Financial Officer is required to make a statement on the adequacy of reserves and the robustness of the budget. This is a statutory duty under Section 25 of the 2003 Local Government Act. This statement is longer than normal, because of the considerable financial risks the authority now faces."

Several pages follow to underline the risks, including warnings of a "precarious" position, consideration of cuts to budgets, a potential serious S114 notice stopping all but essential spending and more.

Ultimately, in a democracy, it is the Leader of the Council Satvir Kaur that has to answer to local residents at the ballot box in May. That is, if residents are aware of this crisis.

We are trying to determine the full reasons for Mr Harrison's departure, but we understand that his departure may have been planned. Without any statement from Mr Harrison or from the Council at budget time, who knows? Mr Harrison cannot be contacted at the Council any longer.

But the timing could not be worse for our City or its finances. Perhaps the Council could have clarified this, but the Council did not mention Mr Harrison's departure in its press release on the Budget. Neither have other local media outlets, at the time of publication of this article.

Southampton Independents reported on the dire inancial warnings earlier this week. The Chief Executive Officer Mike Harris was offered the right of reply, as both he and the Leader of the Council, Labour Councillor Satvir Kaur, were named in the article.

Chief Executive Declines To Comment

In his response, Mr Harris declined to comment. He said:

"Your article is a political blog, and as a politically neutral council officer, I have no comment to make"

Mr Harris would have known about Mr Harrison's departure. He could have commented. But he did not.

At the time of writing, Councillor Kaur has not responded to our request for comment. She would also have known about Mr Harrison's departure and his replacement, Mel Creighton. Ms Creighton was in the same Chief Financial Officer (S151) post before Mr Harrison.

We also contacted the (now former) Chief Financial Officer Mr Harrison by email. An automatic email response was returned (more junior officers have been redacted, because we only name the most senior officers):

"I am now on leave ahead of my final day in post with Southampton City Council on Friday 24th February 2023. .<redacted>.. From Monday 27th February Mel Creighton will take up the post of Executive Director - please redirect any queries to her at Mel.Creighton@southampton.gov.uk after this date, or contact her PA <redacted>"

Labour or Tory, Same Old Story

The usual blame game gibberish has been spouted by Labour Council Leader Satvir Kaur in trying to blame the Tories. As reported by us in our analysis of who has been in power, the Labour Party has been in power in Southampton's Civic Centre for a decade from 2012 to now, except for just one year in 2021/22 when the Conservatives took control. 

And in response the Conservative Spokesman for the Council Budget, Councillor John Hannides has tried to blame Labour. Labour councillors have been the ones making the decisions for almost all of the last eleven years. 

Yet Tory councillors have applauded many of their decisions, with Tory Councillors like Jeremy Moulton even claiming some of the Labour decisions as their own. To put the Council finances in context, the Conservatives have been in power in Westminster since 2010 and as reported by us previously, have savagely cut grant funding to councils, restricted council tax rises and left the country in an economic mess.

As a Former Councillor, I Warned The Council And Residents

In my eight years on the Council, I sat through and spoke at annual Budget meetings, challenging spending and the decisions of whomever was in control of the Council. I was also due to takeover the City's finances as Cabinet Member for Finance. But I declined the opportunity, because I knew that the officers at the council and the other councillors in Cabinet were not up to the job, in the context of the Westminster party system and Leader and Cabinet model of running the Council. 

The current situation proves that I was right. I was not going to go down with the Council under the captaincy of Labour's failed leaders. Instead of joining the Labour Cabinet, in 2015 I quit Labour to become an Independent councillor. And with Southampton Independents and its team, I worked to warn residents and hold the Council's failures to account. I am still doing it, now as a volunteer and reporter - not a councillor. It appears that Mr Harrison has made a similar calculation, after providing the dire warnings officially this week.

Think About The Future Of Southampton

Amid the boring and predictable Labour and Tory bickering, one thing is for sure, as we always say, it's another case of Labour or Tory, same old story. And it's the people of Southampton who will pay the price for the failures of the Westminster parties, their councillors and of Westminster MPs to protect our City.

There will be all-out elections in May for the Council. The people of Southampton could vote a Modern Committee System in later this year, as voted for by the people of  Sheffield and Bristol, if Independent councillors are voted in. Let's see whether that happens or whether Southampton gets more of the same old story.

* Andrew D Pope is one of the co-founders of Southampton Independents and was a councillor between 2011-2019, being Labour between 2011 and 2015 and an Independent between 2015 and 2019. He chose not to stand in 2019.