CIPFA to lead assurance reviews of councils in financial difficulty

The Ministry for Housing, Communities and Local Government (MHCLG) has appointed the Chartered Institute of Public Finance and Accountancy (CIPFA) to carry out independent assurance reviews of local authorities facing financial difficulty.

CIPFA will lead the work with support from Grant Thornton UK Advisory and Tax LLP and Peopletoo Ltd. The reviews will include councils that rely on exceptional financial support (EFS), a form of government assistance used by authorities under severe budget pressure.

MHCLG said the assurance reviews would support its role in overseeing the local government finance system. The work will examine the financial position and governance arrangements of selected councils, alongside the risks and challenges they face.

The reviews are intended to provide an independent assessment of each authority’s circumstances and to inform recommendations aimed at helping councils maintain, or return to, financial sustainability.

Exceptional financial support is available to councils that request help to manage pressures they consider unmanageable in order to set a balanced budget. Support is provided on an exceptional basis and can be conditional on an external assurance review being carried out.

EFS is typically delivered through a capitalisation direction, which allows councils to use capital resources or borrowing to meet revenue costs. The government confirmed the process for 2026–27 in the Local Government Finance Policy Statement published in November.

MHCLG said the list of local authorities that will undergo assurance reviews will be confirmed at a later date.