In its inevitably measured and considered tomes, the PAC has pronounced on the risk for councils in dabbling with commercial activities without the right skills. This is a well made point, although our experience is that councils are recognising this and engaging advisers in supporting and training their staff in these matters. Grant Thornton is running "capacity building sessions with both London Boroughs and west midlands councils to address these very issues. We can't turn the clock back and vibrant councils need to engage commercially to ensure the financial sustainability of public services in their areas.
The increasing scale of commercial activity carried out by local authorities could put council finances at risk, and town halls might lack the necessary skills for such projects, the Public Accounts Committee has warned. In a report examining the financial sustainability of local government, published today, MPs accused Whitehall of being complacent about the risk to local authority finances.Today’s Financial sustainability of local authorities review highlighted that councils were increasingly undertaking commercial activity intended to generate revenue income from capital investment in properties and businesses in an effort to offset government cuts. This includes projects such as developing houses and commercial units for rent or sale.