LGIU: The Changing Role of the Monitoring Officer Report

Weakening of internal council watchdogs puts local authorities at significant legal risk

Local council monitoring officers, those legally required to ensure councils act within the law, lack influence at the top table putting local authorities at significant legal risk, according to a new report from the Local Government Information Unit (LGIU) in partnership with Lawyers in Local Government (LLG) and Browne Jacobson.

Based on in-depth interviews with monitoring officers from local authorities across England (at all tiers and covering rural as well as urban areas), the report concludes that they are increasingly responsible for governance of new companies that have been set up by local authorities to carry out commercial activity. Yet, a lack of effective statutory protection, the absence of meaningful sanctions, tensions with commercial objectives and a lack of seat at the top table leaves many of them undermined. This risk is compounded by severe underfunding.

The report concludes there are two main drivers of the challenges faced by monitoring officers today - the changing budgetary environment and a weakened standards regime. This has led to their capacity being further stretched, issues with recruitment and succession planning, and – most damagingly –- councils taking on greater financial risks in the form of increased commercial activity. 

Chief amongst the financial and legal risks mentioned by monitoring officers in the research was the operation of council companies. Since 2021, councils have been granted powers to set up companies for commercial purposes to seek new and much-needed forms of revenue. However, with innovation comes risks, and many of the most recent catastrophes in local government can be traced back to large-scale failed investments. 

Without the support of a robust standards and sanctions regime, monitoring officers often find themselves in difficult situations whereby they are exposed to personal intimidation or other forms of unprofessional behaviour if they take a stand on enforcing legal norms within the council. Many report stress and absence from work while some have even left the sector altogether.

Monitoring officers feel that the lack of clout in the available sanctions has fed a culture of disrespect and contempt for the rules and the institutional frameworks that govern them. Those that were interviewed as part of this research told us that a small minority of councillors see it as a badge of honour to have been through a grievance process as it demonstrates some sort of rebellious or anti-establishment behaviour.

Key recommendations from the report include a review of council structures to ensure that monitoring officers have a status and position within the top tier of governance and the creation of a professional body for monitoring officers. A full list of recommendations are included below and an embargoed copy of the report is available upon request. The report will be launched at the Lawyers in Local Government Conference on Friday 10 November in Sheffield. More information on the conference is available here.  

Jonathan Carr-West, Chief Executive, LGIU, said: “Councils have never been in a riskier position than they are today. Many councils in England are teetering on the edge of catastrophe, forced by their financial circumstances to take on greater and greater risks to make up for the shortfall in their funding. 

The monitoring officer - responsible for managing and understanding the risks councils face - should be one of the most important figures in the council yet has seen their seniority diminish while taking on additional responsibilities beyond their essential role of ensuring legal compliance. 

Good governance is something that should concern everybody. We have seen recently the all too real consequences of bad decision-making and maladministration at all levels of government. This has an impact on people's lives and livelihoods. But good governance cannot be done on the cheap or left as an afterthought. It needs to be a central component of government, which is defended, respected and, crucially, given the resources to be carried out effectively.

In a situation where councils are facing unprecedented risks, their protection against these risks needs to be enhanced, not reduced. Monitoring officers, together with section 151 officers and chief executives, are part of the golden triangle crucial for protecting councils and the essential public services they deliver, and their role has never been more important.”

Peter Ware, Partner, Browne Jacobson, said: "We at Browne Jacobson are proud to have collaborated with LGIU and LLG on this report and welcome its findings. The report not only addresses the increasing issues facing monitoring officers and councils, it also provides key guidance for local government on how and why monitoring officers are crucial to delivering and improving councils’ services.

It's clear that the role of a monitoring officer is essential for ensuring high-quality legal governance of councils and for ensuring that the biggest challenges they face are well navigated. The issues raised within the report must be addressed in order for councils to keep up with the much-needed change."

Rachel McKoy, President of LLG, said: “The role of the Monitoring Officer is pivotal to the effective governance and lawful decision making of each and every local authority. LLG are delighted to have played a part in this important work for our members and for the sector. This is the first step of a journey towards effecting meaningful change. We need the government to take note, and create the legislative provision required; but we also need the sector to take note, to embrace the cultural change required.

In a time of great instability in local government, we need to give the role of Monitoring Officer the respect it truly deserves.”

For more information - please see here