Two of the three most senior officials at Tees Valley Combined Authority (TVCA) have quit, in the most sensational development yet at the troubled organisation.
Emma Simson, group chief legal and monitoring officer responsible for the lawfulness of TVCA actions, and Gary Macdonald, group director of finance and resources, have both “recently left the organisation”, according to a report being presented to a special TVCA cabinet coming up on Friday.
This follows the redundancy of Julie Gilhespie as group chief executive at the end of March, to be replaced by Tom Bryant as chief executive of TVCA and John Barnes in the same role at South Tees Development Corporation (STDC).
Bryant will recommend the cabinet on Friday to make interim appointments for up to 12 months to the vacant posts, which are statutory and must by law be filled. The nominees are Jodie Townsend as legal and monitoring officer and Jo Moore for the finance and resources post. Both have extensive experience in local government elsewhere in England.
TVCA already has interim directors of business solutions (Sarah Walker) and infrastructure (Julie Hurley) in post.
Background
This is the latest chapter in more than two years of turmoil at TVCA since Middlesbrough MP Andy McDonald stood up in Parliament in April 2023 and alleged industrial-scale corruption at Teesworks, the regeneration site managed by STDC, an offshoot of TVCA. An independent review set up by the Conservative government found no evidence of corruption when it reported last year, but did find issues of governance and transparency that needed to be addressed and that a number of decisions taken did not meet the standards expected when managing public funds.
TVCA suffered more blows this year from its external auditors EY and the Ministry of Housing, Communities and Local Government (MHCLG). In April MHCLG served a Best Value Notice on TVCA “to ensure further improvement at the authority.” Later that month the auditors sent a letter to the Ministry saying TVCA must strengthen its finance team so it can carry out its audit work programme and meet its statutory reporting obligations. The cabinet approved an Organisational Improvement Plan on 27 June.
These events have been extensively reported by North East Bylines.
The new directors
Jo Moore has held positions as executive director of resources at the London Borough of Enfield, interim strategic director of resources at the London Borough of Barking & Dagenham, interim chief finance officer at the Chartered Institute of Public Finance and Accountancy, interim director of finance at Cumbria County Council, and interim deputy chief executive at Cotswold District Council.
Jodie Townsend has been director of law, governance & compliance and monitoring officer at East Midlands Combined Authority, governance consultant/improvement programme lead at Cambridge & Peterborough Combined Authority, governance consultant at Homes England governance consultant at West Midlands Combined Authority and governance consultant at North of Tyne Combined Authority.
According to Bryant’s report the option of making internal appointments was considered but not recommended as “there are no internal candidates who currently have sufficient experience at this level in dealing with the challenges facing the organisation.”
Costs
The salary for the group director of finance and resources is £129,103 plus employer’s national insurance and pension contributions, making a total of £169,148, which is said to be included in the TVCA budget.
However, the proposed candidate is said to be not willing to enter into a fixed-term contract; s/he has an all-inclusive day rate of £1,250 and based on a four-day week the total cost will £215,000 (plus undisclosed agency fee), which is an additional cost of £45,851 on the staffing budget.
The salary for a monitoring officer is £98,916 plus NI and pension contributions; there is again an agency fee. The candidate is again not willing to enter a fixed-term contract and has a day rate of £1,350. The previous postholder worked a four-day week but the proposed replacement will work five.
The salaries of the interim directors of business solutions and infrastructure are £129,103, rising to £169,148 including NI and pension. The interim director of infrastructure, who was recruited through an agency, also receives £850 a month accommodation costs. According to the cabinet report, the cost represents a budget saving of £68,000 compared with appointing at the day rate of £1,062 plus expenses for travel, accommodation and subsistence as proposed by the agency.
It will be stipulated in the contacts of both new appointees that they must regularly work from the TVCA offices. No decision has yet been taken on when to start the process of recruiting a permanent director of finance & resources and monitoring officer, which could take six months. That will depend on progress in implementing the Organizational Improvement Plan. The recruitment of permanent directors of business solutions and infrastructure is proposed to start in September.
TVCA spent a total of £1,704,000 on external legal and governance advice in financial years 2023-25 and is projected to spend another £968,000 in the current year. According to the cabinet report: “There is felt to be potential to reduce external legal/governance expenditure, and the intention is to offset the additional cost of £204,141 (plus agency fees) for the interim appointments against savings on this budget. It is therefore envisaged that the proposal will be cost-neutral.”
It goes on: “The proposed interim appointments…are considered to offer value for money as the individuals will provide significant experience and expertise. This is critically important given the challenges facing the authority, specifically the Best Value Notice and the letter from TVCA’s external auditor (EY). The days rates for the proposed candidates are similar to other candidates on the market with a comparable skill set and level of experience.”
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