It was a devastating indictment of one of Britain’s most powerful councils: a “rotten culture” of dubious contracts and backroom bullying, where staff were silenced and official records dumped in skips. The government’s damning verdict on Liverpool city council was summed up by a single word on the front page of the local newspaper: “Failed.”
The feeling of many Liverpudlians was one of shame, anger and betrayal. “It made me cry when I read the report,” said Jayne Casey, one of the city’s most influential cultural figures. “It’s a city that was standing on the world stage. It’s heartbreaking to see what they did with that opportunity.”
The Labour-run council has been at the centre of corruption allegations since its head of regeneration, Nick Kavanagh, was arrested in his fourth-floor office of the Grade II-listed Cunard building 15 months ago. The investigation escalated in December with the arrest of Joe Anderson, the council’s figurehead for 12 years, alongside four other men including Derek Hatton, the 72-year-old leftwing firebrand who ran Liverpool three decades ago.
A team of Whitehall commissioners has been sent to oversee large parts of the “dysfunctional” council for at least three years – an unprecedented step for a city its size – while Labour has ordered an investigation into what went wrong.
For a city that remains fiercely anti-Tory, there was barely a ripple of opposition to the intervention by Boris Johnson’s government. The prime minister himself has been persona non grata in Liverpool since it was cast as a self-pitying city in a Spectator article in 2004, when he edited the magazine. “Scousers have got long memories,” said one council insider. “You side with the Tories, you’ve slept with the devil. They’re toxic, even today. But this is not a Tory takeover – it’s a team of civil servants.”
Instead of an anti-Tory backlash, the drama has reprised memories of Liverpool’s political pariah status in the mid-1980s when Hatton’s Militant-led council plunged the city into near-bankruptcy. Back then, Labour managed to hold on to its control of the council – partly by expelling Militant members – but today the public mood seems more perilous.
A Liverpool Echo poll of thousands of their readers found that 69% intended to change their vote in the impending council and mayoral elections. Such a shift in six weeks’ time would bring to an end Labour’s longest continuous period in power since the second world war.
One of those who could benefit from an exodus of Labour voters is Stephen Yip, a Liverpool-born charity founder who has promised to give away his salary if elected as mayor. He has never stood for office before, and is standing as an independent candidate, but even his rivals think he stands a good chance. “The city has improved since the 80s but we’re slipping back. The people of Liverpool deserve better – we might not like our politicians but we need to be able to trust them,” he said on Friday.
Labour figures fear losing the mayoralty, a position created by Anderson in 2012, would cast them into the wilderness because the mayor selects their own cabinet and would be unlikely to pick members tainted by the corruption scandal. “We could be completely cut out,” said one source.
Yip, a former Labour member who left the party 20 years ago, said he had been shocked by the lack of contrition this week from some of those leading the council over the past five years: “Has one of them had the decency to hold their hands up and say sorry? No. They should hang their heads in shame.”
Although the focus has centred on the intervention of Whitehall commissioners, one of the most politically significant elements of the government’s announcement has been overlooked: within two years, only one councillor will represent each of the city’s 30 wards.
It will slash the number of councillors by two-thirds, from 90 to 30, potentially tilting the balance of power away from Labour for years to come. “It’s seismic,” said one town hall source. “Forty-seven councillors got suspended over Militant – we’re about to lose 60.”
Michael Parkinson, an honorary professor at the University of Liverpool who has written extensively about the city’s history, said it was a “very challenging, depressing moment” and that there was a “real risk of reputational damage to all of Liverpool – not just the council”.
However, Parkinson said the city was not back in the dark days of the 1980s but was under the leadership of a new chief executive, Tony Reeves, who was singled out for praise by the government’s inspection team.
The clean-up operation began when, shortly after joining the council in 2018, Reeves received two formal complaints and ordered an internal investigation. Its findings led Merseyside police to launch Operation Aloft, under which 11 people have been arrested over allegations ranging from fraud to witness intimidation.
Anderson, the former mayor, has denied the allegations against him and suggested this week that they were the result of “jealousy”. Kavanagh, his former regeneration chief, has said he had always acted within the rules and would defend his innocence. Hatton has not commented on his arrest.
The wider criminal investigation is ongoing with Liverpool braced for further revelations. The political fallout, however, may only just have begun.
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