Hillingdon Council is facing an urgent call for a formal financial investigation following a damning report from external auditors Ernst & Young (EY). The call comes amid concerns over the council's dwindling reserves and a series of financial missteps.

The motion, proposed by Councillor Sital Punja, Deputy Leader of the Labour Group, expresses a complete lack of confidence in Councillor Ian Edwards, Leader of Hillingdon Council, and Councillor Martin Goddard, Cabinet Member for Finance & Transformation. It calls for their immediate resignation and urges the Chief Executive to request a government investigation into the council's financial position.

The catalyst for this motion is the Value for Money Update and Issuance of Recommendations Under Section 24 Schedule 7(2) of the Local Audit and Accountability Act 2014 (S24 Report) issued by Ernst & Young on 24 July 2025. The report highlights fundamental governance weaknesses , including poor data quality and unreliable forecasting. It also notes that the council's reserves are the lowest of any London borough and that the Dedicated Schools Grant (DSG) deficit has reached £65.71 million, nearly ten times the council's reserves.

The S24 Report made seven formal statutory recommendations to the Council under Section 24 Schedule 7(2) of the Local Audit and Accountability Act 2014, including:

  • Ensuring detailed implementation plans for all planned savings.
  • Reviewing service delivery models for efficiency.
  • Balancing the schools' budget to prevent further growth in the Dedicated Schools Grant (DSG) deficit.
  • Reviewing financial forecasting processes.
  • Establishing a clear understanding of the council's current financial position.
  • Addressing issues with the implementation of Oracle EPM.
  • Continuing the development and implementation of the Financial Modernisation Programme and the Governance Review Improvement Plan.

Councillor Punja's motion points to several other worrying factors, including the fact that Hillingdon has had four Section 151 officers (Chief Financial Officer) in the past 18 months, persistent delays in financial reporting, and a forecast £16.4 million overspend for 2025-26, which is more than double the council's remaining reserves.

The motion states that the council is now seeking Exceptional Financial Support from the government, demonstrating that the Conservative administration has lost complete control of the accounts.

During the Council meeting on 11 September 2025, Councillor Goddard addressed a question from Councillor Nick Denys, Chair, Health & Social Care Select Committee, regarding the Financial Improvement Programme. Councillor Goddard explained that the programme aimed to modernise finance operations and improve cost-effectiveness, including the rollout of the Oracle Fusion EPM system. He also noted that £14.6 million in savings had been identified from the high needs block, with break-even projected by 2027/28.

However, the auditor's report paints a grim picture, stating that the Council is not compliant with its legal obligation to set a balanced budget. The report also raises concerns about the Oracle EPM implementation, stating that decision-makers are unable to access accurate and complete budgetary information.

Specific challenges encountered during the implementation of the Oracle EPM system include inaccurate user lists, frequent issues with the completeness and accuracy of budget information, and licensing issues impacting the completeness of information available to users. Internal audit also noted that financial governance was also significantly impacted during the year due to issues with the implementation of the Oracle finance system .

The Council's Financial Modernisation Programme (FMP) is a significant transformation initiative to review and strengthen the Council's financial systems, processes, and structures. It was initiated to address budget challenges and to modernise the Council's financial infrastructure. With the appointment of Grant Thornton in April 2025 to support this work and with the Local Government Association (LGA) providing objective oversight, it's aim is to assist the Council in modernising its financial processes, strengthen its financial management, develop a modern finance function, and embed processes and controls in the Council's financial system, Oracle.

The Governance Review Improvement Plan (GRIP) is Hillingdon Council's strategic approach to enhancing its governance and implementing learning from related reviews presented to earlier Audit committees. It aims to strengthen internal controls, clarify internal decision-making, and improve accountability, ensuring the Council operates a continuous improvement approach to being well-governed corporately, financially resilient, and transparent. The programme was launched in March 2025, led by the Corporate Governance Group. The GRIP is structured around three workstreams - financial governance, directorate governance, and constitutional/democratic governance - each with defined actions and leadership.

Both the Financial Modernisation Programme and wider Governance Review Improvement Plan are in the early phases of implementation, and it remains to be seen whether they will deliver the improvements in internal controls and governance which are urgently required.

The Council meeting also saw discussion of the External Auditor's report, with the council scheduled to decide whether to accept the recommendations and what actions to take in response.

The motion from Councillor Punja was lost. Opposition to Councillor Punja's motion was based on the view that the Rural Activities Garden Centre had been a commercial, not commissioned, service. The subsidy withdrawal was defended as financially responsible, consistent with previous decisions on non essential services. Confidence was expressed in adult social care services and assurances were given that alternative support would be provided. The closure was described as limited to retail operations, with horticultural activities under review and engagement with families ongoing. It was maintained that the Council lacked the mandate to run a commercial garden centre.

The motion was supported by Councillors Abby, Basit, Burles, Curling, Dhot, Farley, Gardner, Garelick, Garg, Islam, Kaur, Lakhmana, Mand, Mathers, Money, Nelson, Nelson-West, Punja, Sansarpuri, Singh and Sweeting.

The meeting, which commenced at 7.30 pm, closed at 10.17 pm.