LGA Corporate Peer Challenge: London Borough of Hounslow

A team of local government peers, led by the Local Government Association (LGA), delivered a Corporate Peer Challenge (CPC) of London Borough of Hounslow in November 2025. The council’s previous CPC was in 2017.

CPC is a well-established and respected improvement and assurance tool that provides robust, strategic and credible challenge and support to councils. Further details about the process can be found in Appendix A.

The CPC team consisted of senior local government councillor and officer peers. The peer challenge considered five core areas: local priorities and outcomes, organisational and place leadership, governance and culture, financial planning and management, and capacity for improvement.

This report provides London Borough of Hounslow with feedback on the peer team’s findings. It provides the council with a set of a high-level recommendations alongside further recommendations under each of the CPC’s core areas. The council is expected to publish this report and an accompanying action plan to respond to all the recommendations highlighted.

The London Borough of Hounslow (LBH) is an effective council with visible political and officer leadership. It has demonstrated strong performance in priority areas and has received good judgements from external inspections. 

The council’s positive culture is reflected in strong organisational health indicators. The peer team found that staff are engaged and proud to work for the council. Governance arrangements are sound, and member-officer relationships are constructive and characterised by mutual respect and appropriate challenge. There is scope to strengthen partnership arrangements, with an appetite from voluntary sector organisations and businesses for greater collaboration and collective action.

Over the past two years, the council has improved the management and governance of its Lampton Group arrangements. This provides a good platform for a further phase considering the council’s longer-term strategy for the companies.

The council has made progress with its work on equality, diversity and inclusion (EDI) and on community engagement – but recognises further improvement is needed. On EDI, the council could be clearer on the interventions that will have the greatest impact and how progress in reducing inequality is best measured. On community engagement, there is benefit from the council articulating what ‘passing on the power’ means for Hounslow, including the relative focus on co-production and community investment. This may mean a further evolution in the council’s support and arrangements.

The council remains in a relatively strong financial position, despite the organisation facing significant financial pressures over the past two years. Positively, LBH is set to be a relative beneficiary from the Fair Funding Review, with the council expected to receive further resources from 2026/27 onwards. Following confirmation of the local government finance settlement, the council should communicate clearly and consistently the scale of its financial challenges and opportunities, as the peer team found mixed understandings of the current position across the organisation.

LBH has an interest in, and capacity for, further improvement. The council is currently reviewing its corporate services, which is an opportunity to support a more joined-up approach to planning and delivery. Some elements of the organisation’s current arrangements appear fragmented, and this is reflected in its performance, delivery plan and EDI reporting. In addition, there is value from developing a refreshed vision and overarching programme for transformation.

The council has a strong focus on place-based growth and has invested in the council’s internal capacity, including specialist resources. To build on this, the council should ensure that all its growth-related functions are aligned to best support investment and delivery. The council has also undertaken significant work to develop Hounslow’s offer to public and private investors; the next step is to tell the borough’s story more assertively both regionally and nationally. 

The following are the peer team’s key recommendations. 

3.1 Recommendation 1

Following the financial settlement, communicate clearly the scale of the council’s financial challenges and opportunities 

3.2 Recommendation 2

Develop a refreshed vision and overarching programme for transformation 

3.3 Recommendation 3

Articulate and communicate what ‘passing on the power’ means for residents and put the infrastructure and support in place to achieve this e.g. deep listening, co-production, stepping out of the way, community investment and innovation

3.4 Recommendation 4

Develop a more joined-up approach to planning and delivery, supported by the corporate services review 

3.5 Recommendation 5

Maintain the commitment to tackling inequality but be clearer on the interventions that will have the greatest impact and how progress is best measured

3.6 Recommendation 6

Build on the work that has improved the Lampton Group arrangements with a further phase considering the long-term strategy

3.7 Recommendation 7

Consider further how businesses and VCFSE groups across the borough can be convened for collective leadership and action

3.8 Recommendation 8 

Consider further aligning the growth enabling functions to ensure investment and delivery are guided by a single vision for inclusive, sustainable growth

3.9 Recommendation 9

Take the next step in promoting Hounslow’s story, regionally and nationally

In addition to the key recommendations, section five of this report captures detailed feedback and additional recommendations within each of the CPC’s core areas of focus.

The composition of the peer team was shaped by the specific focus of the CPC, with the LGA selecting peers based on their relevant expertise. The peers for this CPC were:

• Cllr Muhammed Butt, Leader of London Borough of Brent
• Cllr Elizabeth Campbell, Leader of Royal Borough of Kensington and Chelsea
• Alison McKenzie-Folan OBE, Chief Executive, Wigan Council
• Conrad Hall, Corporate Director of Resources, London Borough of Newham
• Shefali Kapoor, Director of Communities, Manchester City Council
• Nabeel Khan, Corporate Director for Climate and Inclusive Growth, London Borough of Lambeth
• Tinu Olowe, Director of HR and OD, London Borough of Enfield
• Kevin Kewin, LGA Peer Challenge Manager.

5.1 Local priorities and outcomes

The corporate plan has served the council well and it has a track-record of good delivery, which is evidenced by external inspections. The council has a strong commitment to community engagement and reducing structural inequalities; there is scope to build on its significant work to date to make it more impactful.

The peer team has two key recommendations relating to this theme:

• Articulate and communicate what ‘passing on the power’ means for residents and put the infrastructure and support in place to achieve this (R3).
• Maintain the commitment to tackling inequality but be clearer on the interventions that will have the greatest impact and how progress is best measured (R5).

In addition, the peer team recommends the council consider the following action:

• Benchmark the council’s residents survey results against councils that use the same methodological approach.

Are the council’s priorities clear and informed by the local context?

The council has a clear corporate plan – ‘Ambitious for Hounslow’ – which was published in 2022. It sets out the council’s priority themes and key targets for the period, alongside its three cross-cutting programmes relating to equality, diversity and inclusion; community engagement; and residents’ experience of the council. The peer team found a generally good understanding of the council’s corporate plan across the organisation. The forthcoming refresh is an opportunity to define objectives for the next four to five years, with clear prioritisation aligned to the Medium-Term Financial Strategy (MTFS). As in many councils, the organisation is managing an expanding portfolio of programmes and there is an opportunity to sharpen focus on high priority outcomes. 

The state of the borough report provides a strong evidence base of Hounslow and how it is changing. This supports the council’s understanding of its challenges and can inform the new corporate plan. In addition, the Hounslow Vision 2050 work is evidence of the council leading horizon-scanning and futures thinking that can inform strategic planning. The peer team commend Hounslow Vision 2050 and support the council’s plans to further communicate it. Despite considerable engagement as part of its development, Hounslow Vision 2050 does not yet appear to have strong resonance across the organisation or with partners. 

Delivery against priorities and comparative performance

The borough benefits from generally good council services. The Regulator of Social Housing (RSH) recently reported that the council’s services met the second highest consumer grade (C2) and highlighted its commitment to resident safety, service quality and ongoing improvement. Hounslow was rated as Good for its adult social care services by the Care Quality Commission (CQC) in May 2024 and for its children’s services by Ofsted in October 2023. A more recent Special Educational Needs inspection (October 2024) highlighted inconsistent outcomes and a need for the local area partnership to make improvements.

In addition to external inspections, comparative performance information captured in the LGA’s LG Inform data tool provides a sense of the council’s performance strengths and weaknesses.

Overall, the council fares better than London averages for many indicators. Delivery of affordable homes is a comparative strength with more homes delivered (656) annually compared to the London borough average (396). LBH has also managed to maintain relatively low numbers of households in temporary accommodation (TA), bucking a broader London trend, and the council has a comparatively small housing waiting list. This track record in housing delivery and TA demand management deserves recognition and is the result of the strong partnerships observed by the peer team. Positively, the council also has a better than London average position in terms of both recycling and road maintenance.

However, many public health and employment outcomes are worse than London comparators. For example, Hounslow has relatively high levels of childhood obesity, and healthy life expectancy stands at just 60 for men and 62 for women – lower than both London and national averages. Alcohol-related hospital admissions rank among the highest in London. In addition, residents are not getting the full benefits from a relatively strong Hounslow economy: the median job in the borough pays £5,000 more than the average income. One in four working age adults in the borough are economically inactive, which is a higher rate compared to both the London and national averages.

Is there an organisation-wide approach to continuous improvement? 

The council is transparent in tracking its progress. The organisation publishes performance information on a quarterly basis as part of its reporting to Cabinet, including a direction of travel and RAG status for each metric. There is potential for this information to be more accessible, informed by the more user-friendly and comparative approach used in the council’s ‘state of the borough’ report.

More broadly, the council’s corporate reporting appears fragmented. The peer team observed that Cabinet receives separate reports on delivery plan monitoring, performance monitoring and progress on Equality, Diversity and Inclusion (EDI), each produced by different teams using varying standards. There is an opportunity to better align these arrangements and bring wider performance insights – such as from complaints – into a more comprehensive framework. The peer team recommend that the corporate services review consider how best to support a more joined up approach to planning and delivery, including through its performance management framework.

Hounslow has recently undertaken a residents’ survey using a representative sample with a face-to-face methodology. This provides the council with reliable insights on residents’ views, including over time. The results are impressive. For example, the survey found that 82 per cent of residents are satisfied with the borough as a place to live, 88 per cent see their local area as a place where people from different backgrounds get on well together and 74 per cent think the council is doing a good job. The council is currently comparing itself to the LGA’s national survey as a benchmark. However, given the two surveys’ methodological differences – for example the LGA’s poll is telephone-based – this is a not a good comparator. A face-to-face survey would typically provide a more positive result. The council should benchmark against councils using the same methodological approach to better understand how it compares to others.

Equality, Diversity and Inclusion (EDI)

The council’s EDI strategy ‘A Fairer, More Equal Hounslow’ was agreed in 2023 following extensive engagement with residents and partners. The council’s plan is structured around three pillars: equality by place, equality by group and equality as an employer. It is supported by a range of delivery plans and supporting arrangements, including geographical opportunity areas, mission-based objectives and action plans.

The peer team was impressed by the council’s commitment to EDI and the breadth of activity. Reports reviewed set out detailed programmes of work, including business as usual and EDI specific interventions. For example, the council supports public-facing equality partnerships on race, disability and age, women, LGBTQ+ and sensory equality to help ensure that decisions and services reflect lived experience. 

In further developing its approach, there is value in the council articulating, in simple terms, the highest priority inequalities it is seeking address, the interventions that will have the greatest impact and the headline metrics that will measure progress. The relative prioritisation and impact of the council’s EDI work was not always as evident to the peer team as the actions it is taking. In addition, compared with some other councils, there appeared to be less explicit focus on intersectionality. 

Community Engagement and ‘Passing on the Power’

The council has delivered a programme of work – called the radical overhaul of consultation and engagement – to improve council practice in this area. As a result, a range of new or revised arrangements now underpin the council’s approach. These include a residents’ panel, refreshed area forums, ward walks, an engagement network and equality partnerships. These mechanisms were themselves subject to considerable engagement with staff, members, partners and residents, including an independent citizens’ jury. The elements demonstrate the council’s commitment and have supported decisions and services to be shaped by the people they affect. 

The peer team see scope to build on recent work and further develop the approach. Overall, current arrangements can appear fragmented and there is potential for a stronger feedback loop. A helpful next step would be to articulate what the ambition of ‘passing on the power’ means for Hounslow. A clear, shared vision of this would help define the council’s level of ambition, including the relative balance between co-production, community investment and stepping out of the way compared to more traditional consultation and engagement. This articulation would also provide a guide for how the council’s engagement infrastructure should evolve over time.

5.2 Organisational and place leadership

The council is providing good organisational and place leadership. LBH is well regarded by statutory partners and is considered a reliable organisation to work with. Encouragingly, the council is developing its place leadership approach, including on growth and regeneration. However, there remains clear appetite – particularly among VCFSE organisations and businesses – for greater collaboration.

The peer team has three key recommendations relating to this theme:

• Explore further how businesses and VCFSE groups across the borough can be convened for collective leadership and action (R7).
• Consider further aligning the council’s growth enabling functions to ensure investment and delivery are guided by a single vision for inclusive, sustainable growth (R8).
• Take the next step in promoting Hounslow’s story, regionally and nationally (R9).

Does the council provide effective local leadership?

The visible leadership of the leader and chief executive is valued and seen as effective across the organisation. The council benefits from constructive, respectful relationships between elected members and senior officers. The peer team also observed some tensions between opposition members and the executive, although this is not atypical – particularly in the run‑up to elections. Members feel well supported in their roles, with a good induction and an ongoing development programme offering a range of mandatory and optional training and briefings.

Positively, the council’s leadership is also well-regarded by partners, with Hounslow viewed as a reliable organisation to work with. Feedback to the peer team highlighted that the council demonstrates openness and a genuine willingness to work together, including on complex and challenging issues. The peer team heard that the new chief executive had further strengthened the focus on collaboration – both internally across the organisation and externally with key partners.

The council recognises its place shaping role and actively brings partners together to drive progress across the borough. Beyond its statutory governance responsibilities, it has established a range of collaborative forums, such as the Opportunity Hounslow Conference, which focuses on promoting inclusive growth. The biennial Hounslow Assembly convenes diverse stakeholders to tackle key borough challenges and could be further strengthened with a sharper articulation of purpose and delivery priorities so all attendees are clear on their role. While these arrangements are positive, the peer team noted a strong appetite for deeper collective leadership – particularly among voluntary organisations and local businesses.  There is value in exploring how partners can be convened more regularly and systematically around common goals to maximise impact.

Voluntary, Community, Faith and Social Enterprise (VCFSE) groups

The borough benefits from a strong VCFSE sector, with over 800 active organisations and around 7,000 registered volunteers. The council invests in the sector’s infrastructure, including support to the local council for voluntary services, Hounslow’s volunteer centre, joint commissioning with the NHS and VCFSE partners for preventive and specialist services, and a thriving communities fund to enable community-led projects. In addition, the council is supporting Community Development Networks (CDNs), where around 100 VCFSE organisations and residents come together each month to collaborate, share resources and form new partnerships.

VCFSE organisations’ interest in greater collaboration aligns with the council’s ambition to deepen co-production with residents and build capacity across the sector. Positively, the council now has a clear strategic framework – the Thriving Communities Strategy agreed in 2024 – and has made recent progress. The CDN model, for example, emphasises empowerment and supports communities to work alongside the council rather than depend on it.

As the council further develops its approach, there is value in considering whether it can provide greater funding certainty to the sector. For the first time in several years, LBH will receive a three-year funding settlement from government. This may create an opportunity to reduce year to year variation in VCFSE funding. The peer team noted, for instance, a significant difference in resource levels for the thriving communities fund between 2024/25 and 2025/26. While some variation is to be expected – the fund is partly resourced from variable income (i.e. the Community Infrastructure Levy) – there may be scope to provide greater certainty around the council’s General Fund contribution. Significant short-term fluctuations can hinder longer term planning and delivery in the VCFSE sector, which may impact the council’s ambitions on prevention and using strength-based approaches. 

Growth and Regeneration

The council has a clear strategic narrative for inclusive growth and has recently published its growth business case based round four pillars: industry, people, place and promotion. It recognises current sectoral strengths – for example, Hounslow has the highest concentration of media and broadcasting jobs in London – as well as the areas where improvement is needed.

The council is taking an active role in leading place-based regeneration. Future Feltham, for example, is a major partnership between the council, GLA, the Ministry of Defence and private partners to deliver ambitious regeneration projects, including on MoD land. The council is also working hard to develop the Golden Mile (Great West Road), with the aim to unlock 7,500 new jobs and 14,000 new homes.

The council is actively investing in growth to secure longer term benefits. For example, it has created a £2.2m revenue growth fund to drive its programme of activity. The intention is that this additional funding will not be required on an ongoing basis, as it will be offset by capitalisation and external funding alongside additional income from council tax and business rate growth. The use of the growth fund, and the benefits it seeks to achieve, are reported clearly to Cabinet.

The peer team observed that growth-enabling functions are currently dispersed across the organisation. There is an opportunity to strengthen their alignment to enhance coordination, maximise synergies and deliver stronger outcomes. While this does not necessarily require structural changes, there is clear potential for functions such as skills, employment, planning and regeneration to work more closely together to achieve shared objectives.

Overall, the peer team considers that the council has established strong arrangements to support growth. These include enhanced internal capacity, investment in mature partnerships and a demonstrable track record, particularly in housing delivery. In this context, there may be an opportunity for the council to consider whether to be more ambitious in a small number of carefully chosen areas. The organisation is well positioned to test where a more assertive approach – for example, in accelerating priority regeneration programmes, strengthening its role in securing infrastructure investment or further raising LBH’s profile as a convenor across West London – could deliver additional benefits. Any such steps would need to be proportionate and carefully managed, but they could help the council maximise its existing strengths and the momentum it has generated.

In promoting the borough, the council should use its growing influence through the West London Alliance and across other London partnerships. Hounslow benefits from its position within two of the UK’s most productive economies – London and the Heathrow-Slough-M4 corridor – but competition to attract partners, investment and innovation is intense. The council has already taken significant positive steps, including developing a place brand with partners, and a newly formed network is driving this forward. The council also recognises the importance of infrastructure investment to support Hounslow’s development. This includes both major projects – most notably the West London Orbital, a proposed extension to the London Overground – as well as shorter-term improvements such as enhanced bus services. Maintaining a clear and compelling case for investment will be essential to securing the resources needed for Hounslow’s future development.

5.3 Governance and culture

The council benefits from good governance arrangements that are supported by a positive organisational culture. The peer team found that staff are proud to work for the organisation. Positively, the council has improved its management of the Lampton Group arrangements, which provides a good platform for its next phase of thinking.

The peer team has one key recommendation relating to this theme:

• Build on the work that has improved the Lampton Group arrangements with a further phase considering the long-term strategy (R6).

In addition, the peer team recommends the council consider the following actions:

• Review the development process for the Annual Governance Statement
• Identify whether any further changes should be made to Overview and Scrutiny (O&S) for May 2026.

Are there clear and robust governance arrangements?

Formal governance and decision-making processes are clear and well understood across the organisation. Councillors are supported to make informed decisions through clear, well-structured reports. The peer team found that officers are confident in providing objective advice and members are engaged with the implications of their decisions.

There is a range of informal governance arrangements, which appear to work well. The council has recently strengthened internal processes, including the introduction of an Assurance Board and regular directorate level meetings which are chaired by the chief executive and focus on finance, performance and risk. 

The Annual Governance Statement (AGS) would benefit from further development. There is value in using the statement – and its annual preparation process – to set out explicit improvement actions. This should include areas for development for the year ahead and progress against the previous year’s actions. Even the best governed councils will identify areas to strengthen. Recent internal changes – such as the Assurance Board – are not yet reflected in the AGS.

The council has recently refreshed its risk management arrangements, building on the strategy agreed in 2022. Its approach is broadly consistent with sector practice and, positively, the council is seeking to further improve. This includes extending the risk management system to cover service-level risks and ensuring risk is discussed more consistently at the senior leadership team (SLT).

Is there a culture of challenge and scrutiny?

The council has well established Overview and Scrutiny arrangements, with an O&S Committee supported by three thematic panels: Children and Young People, Health and Adult Care, and Housing and Environment. A recent Centre for Governance and Scrutiny (CfGS) review found scrutiny in Hounslow to be performing effectively. The peer team heard similar messages, while noting this view is not universally held. The period immediately following the May 2026 elections presents an excellent opportunity to introduce and embed further improvements, including addressing any outstanding issues highlighted in the CfGS review. This may include work to publicly track progress of scrutiny’s recommendations and further strengthening budget scrutiny arrangements.

The council’s core values – developed in 2022 – are distinctive: lead with heart, do new, pass on the power, harness the mix and be a rock. The peer team found these values are well understood across the organisation, and staff reported they are embedded in processes and behaviours. It is positive that the values have stood the test of time and remain a real strength, shaping how people work and interact at all levels. They underpin an organisational culture widely regarded as supportive, constructive and respectful.

The organisation’s culture is a significant positive and should be celebrated. The peer team heard that, over the past year, there has been a welcome focus on cross organisational collaboration. Staff feel valued and there is a clear sense that the organisation is committed to its people. Sustaining this positive culture will be essential, alongside maintaining a consistently ambitious and self-challenging approach.

Lampton Group arrangements

The council created the Lampton Group (Lampton 360 Ltd and its subsidiaries) in 2013; it currently consists of six companies and one limited liability partnership. Lampton provide a range of critical functions for the council, including housing repairs and maintenance, waste and recycling services. It is a significant employer with more than 1,000 staff, most of whom (63 per cent) live within the borough. As a comparator, the council itself has around 2,400 FTEs. The Lampton Group’s role and responsibilities have evolved over time; for example, council parks and grounds maintenance were added in 2018 following the collapse of Carillion, and council leisure provision has been included within the Group since the Covid-19 pandemic. 

Over the past two years, the council has made considerable progress in improving governance arrangements relating to Lampton. This includes the creation of a Shareholder Committee to strengthen oversight of the council’s interests in its companies. More recently, Lampton consolidated its internal governance, moving to a single Group Board overseeing all entities to support more consistent standards, clearer accountability and a unified strategic direction across subsidiaries. In addition to governance improvements, the peer team heard that strategic and working relationships between the council and the Lampton Group have improved significantly. These changes provide a solid platform for further improvement.

The Lampton Group’s 2025/26 business plan sets out plans to reduce costs, improve efficiency and grow external income. However, it is recognised that further action is required to address the current structural deficit of approximately £14 million. Building on the considerable progress over the last two years, the peer team recommends that the council consider a broader review of options for the longer term. This could include considering the benefits of the current Lampton model –such as greater commercial flexibility than an insourced operation, and more local control compared to traditional outsourcing – against the potential merits of alternative arrangements. Lampton Group now oversee a significant range of public-facing services for the council.

5.4 Financial planning and management

The council is in a relatively strong financial position, with reasonable reserves. However, recent overspends have highlighted growing financial pressures. There are varied understandings of the council’s financial position across the organisation, which can be clarified once the local government finance settlement is confirmed.

The peer team has two key recommendations relating to this theme:

• Following the financial settlement, communicate clearly the scale of the council’s financial challenges and opportunities (R1).
• Develop a refreshed vision and overarching programme for transformation (R2).

In addition, the peer team recommends the council consider the following actions:

• develop the council’s approach to commercialisation
• accelerate implementation of the council’s asset strategy.

Does the council have a clear understanding of its financial position? 

The council is in a relatively strong financial position compared to some other London boroughs. Its level of general fund (GF) unringfenced reserves (compared to net revenue expenditure) are around the London average (7 per cent), and its cost of debt relative to budget is comparatively good. The external auditor’s most recent assessment did not highlight risks or significant weaknesses in the council’s value for money arrangements. Positively, the council published draft accounts for 2024/25 in line with the national deadline. 

Despite historical financial strengths, the council – like many London Boroughs – has faced a challenging period. In 2024/25 the GF budget was overspent by £14.8m, with the largest single overspend within the adult social care directorate (£4.2m). This followed a £5.3m net overspend across the council in 2023/24. Financial pressures are clearly impacting on the council’s GF reserves, which reduced by £59.8m (30 per cent) in 2024/25, £6.8m more than forecast. While the council plans to use £29.0m of reserves to balance the 2025/26 budget – alongside delivering £13.3m of savings – Quarter 2 monitoring is currently forecasting a £10.5m end-of-year overspend. At the time of the peer challenge, the council’s medium term financial strategy (MTFS) was forecasting a gap of £51.5m for 2026/27, including a £10m contribution to reserves.

Budget planning is well-advanced and collaborative. It started early in the year with a Cabinet-CLT awayday in April, supported by officer budget challenge sessions through spring and early summer. A recent Cabinet-CLT awayday in October was used to test and refine options ahead of formal budget decisions. Directorate and finance colleagues described the process as constructive. The peer team heard that the council has developed a provisional package of savings of approximately £30m for 2026/27, which would further help reduce – but not fully address – the forecast financial gap.

The forthcoming financial settlement, including outcomes from the Fair Funding review (FFR), will provide greater certainty on the medium-term outlook. At the time of the CPC, the council had not communicated publicly or internally that financial modelling suggested the council was likely to be a relative beneficiary of the FFR. 

It is understandable that the council chose not to communicate this potential benefit while the government’s FFR consultation was live and subject to change. However, this may also have contributed to mixed understandings of the council’s financial position among staff, with some reports of impacts on service level decisions (e.g. pausing recruitment to an establishment post). The peer team heard from some officers – including senior staff – that the council might be close to requiring Exceptional Financial Support. Subject to FFR outcomes being broadly in line with the consultation period models, this is not the case.

Positively, the council does not have a significant Dedicated Schools Grant (DSG) high needs deficit. Hounslow has continued to meet Safety Valve targets and is receiving DfE contributions towards clearing the cumulative deficit. The council is currently on track to fulfil its agreement and reach a balanced High Needs budget by 2027/28. But the council also recognises that the largest reductions in cost, and the most significant changes, are being implemented over the next two financial years. Quarter 2 monitoring is showing the council to be broadly on track, with a small forecast overspend £0.1m.

Hounslow is experiencing financial challenges in its Housing Revenue Account (HRA). This partly reflects ongoing high demand for affordable social housing and statutory limits on allowable rent levels. At the end of 2023/24, the council’s HRA general reserve fell significantly below the recommended level (15 per cent of turnover) to £3.6m. This leaves the council exposed to even small financial shocks and constrains its investment ambitions.  In 2024/25, the council made a £2.1m contribution to reserves (against a target of £3.4m) and a further contribution of £1.8m to the HRA general reserves is budgeted for 2025/26. 

Does the council have a strategy and plan to address its financial challenges?

As highlighted above, the council has been developing savings proposals to help address its budget gap. The outcome of the settlement, including the FFR, will confirm the scale of the financial challenge. Irrespective of the exact savings requirement, the council recognises that there is value in taking further action, including in terms of its use of assets, commercialisation and transformation.

There are recent examples of a strategic focus on property assets being used to improve outcomes and reduce the council’s costs, including capital investment in a new children’s home in the borough and additional extra care provision. More generally, the council holds a significant property portfolio, and there is scope to consider how this estate can be better used to support both the council’s ambitions and its financial position.

The council has made progress by mapping its assets, agreeing an asset strategy and planning a place based approach to implementation. However, few decisions have yet been made on specific assets – for example, whether to dispose, pursue community asset transfer or use sites to co-locate services. Advancing these decisions should be a priority over the next period, aligned to the new corporate plan.

The council recognises the need for a more corporate approach to commercialisation. While there are some small scale, service led initiatives (such as sponsorship for specific events), there would be benefit in a strategic, council wide approach to income generation underpinned by agreed principles. Many councils have found it helpful to establish commercialisation as a dedicated transformation workstream to both bring together existing expertise and to ensure activities are aligned with corporate priorities.

The council’s One Hounslow Delivery Plan details transformation projects and programmes but there is no cross-council transformation programme. Given the changes within the council and the wider context over recent years, there is an opportunity to define a set of cross-cutting transformation themes for the coming period and to clarify how they relate to savings delivery. As part of this, it would be helpful to set out the respective roles of departments and the corporate centre, linked to the forthcoming corporate services review.

5.5 Capacity for improvement

The council has demonstrated its ability to deliver effectively. Organisational health indicators are positive and there are plans for further improvement. Completing the executive director recruitment process and implementing the corporate services review will be central to further progress.

The peer team has one key recommendation relating to this theme:

• Develop a more joined-up approach to planning and delivery, supported by the corporate services review (R4).

The peer team also recommend the council consider the following actions:

• Explore where there can be greater staff empowerment to support quicker operational decision-making and delivery.
• Consider the alignment of EDI activity as part of the corporate services review.

Is the organisation able to bring about the improvements it needs, including delivering on locally identified priorities? 

The council recognises the need to complete its senior level recruitment to support a more sustainable and distributed leadership model. The recent internal appointment to the chief executive position and the departure of an executive director means there is a range of interim reporting lines at a senior level. This includes, for example, the director of environment reporting to the director of health and care integration.  The chief executive currently has a high number (ten) of direct reports and direct service responsibilities, in addition to her head of paid service role.  Plans are in place to recruit a permanent executive director of place, while the assistant chief executive role will be considered as part of a broader review of corporate services. The peer team support this approach.

Staff are proud to work for the council and are passionate about improving services for residents. This is reflected in generally positive organisational health measures. For example, sickness absence stands at six days per employee per year and the staff turnover rate is 5.7 per cent – both significantly lower than sector comparators.

The council’s 2024 staff survey results were positive, with strong scores for connection and belonging. These outcomes may reflect sustained work over the past three years, including improvements to recruitment processes and a refresh of the frameworks that supports the council’s staff values and behaviours. There is a strong focus on Equality, Diversity and Inclusion (EDI) as an employer, and there are effective staff networks, although some staff also highlighted the potential for greater diversity at very senior levels of the organisation.

The council has a good employment offer. This includes standard arrangements – such as employee discounts and staff wellbeing services – as well as additional benefits, such as additional leave between Christmas and New Year for all staff. The council also has a strong learning and development offer: for example, more than 100 staff members are currently undertaking level 3 or 5 apprenticeships. Given the challenges of the London employment market, the peer team felt there was value in further exploring whether the approach to staff development, wellbeing and progression could be strengthened. Overall, staff were less positive about opportunities for career development than other aspects in the recent staff survey.

The council has recently introduced a resolution framework as an alternative to traditional disciplinary and grievance procedures. The framework prioritises problem-solving and restorative approaches over more punitive measures. The peer team observed largely positive feedback on the framework and noted promising early signs from its implementation, although it is too early to fully assess its impact on employee relationships and performance. 

Internal communications have improved. Staff demonstrated a good understanding of key corporate messages, supported by a weekly all staff bulletin. Virtual and in person events provide forums for staff to come together; there was positive feedback, for example, about LBH Live as a space for two-way engagement and staff questions. There is potential to build on these strong corporate arrangements by driving greater consistency at departmental level, as some staff reported varied experiences. The council’s work to celebrate achievements – including its annual staff awards – is valued; there are typically more than 350 nominations each year.

Does the council have the capacity to improve?

There is scope for digital and AI to further shape service design and support the council’s ambitions. The council’s digital strategy (2021) is structured around four pillars: staff and workforce; services and customers; place and communities; and collaboration and data. The council is proud of recent progress, including a new residents’ portal. Unusually, the council reports publicly on the delivery of specific digital projects in its quarterly Cabinet updates. There is potential to complement this with clearer performance information against key metrics to demonstrate impact.

Like many councils, Hounslow operates with legacy digital systems and large volumes of data but relatively limited business intelligence capability. Positively, the council will support 30 staff through a data academy early next year. There may be value in undertaking an independent digital assessment to understand overall digital maturity, identify priority improvements and inform the forthcoming refresh of the digital strategy. Given developments since 2021, the peer team would also expect to see further action on AI, cyber security and the promotion of a digital culture within the strategy, alongside published success measures to track progress.

The council benefits from good programme management arrangements, which provide rigour to planning and delivery. These include clear review processes, regular reporting and the publication of businesses cases. As in many councils, there is the challenge of ensuring consistency across departments and ensuring arrangements are always proportionate to risk and complexity. Overall, the One Hounslow Project and Programme Management (PPM) approach is a strength and provides a firm foundation for further transformation.

There may be opportunities to strengthen staff empowerment to enable quicker operational decision making and implementation. Some staff fed back that internal arrangements can feel unnecessarily bureaucratic. A practical example is the relatively low spending control limit of £5,000, which can hinder prompt delivery. While the peer team did not explore this in detail, the council may be able to identify areas where informal governance and processes can be streamlined without unduly compromising accountability or oversight.

The council will shortly undertake a review of corporate services to ensure the organisation has the central capacity and capability to deliver its priorities effectively. Alongside considerable good practice within these functions, the peer team identified some atypical arrangements (e.g. its legal hub model), opportunities for better alignment (e.g. corporate reporting) and further opportunities for development (e.g. commercialisation). There is the potential for a more joined-up approach to planning and delivery. The peer team support the terms of reference for the review but would also suggest the alignment of EDI activity – currently out of scope – to be considered as part of this work. 

The senior political and managerial leadership of the council will want to review and reflect on the findings of this CPC.

To promote transparency, it is a requirement of the CPC process that the peer team’s final report is published within three months of the review being completed. In this instance, this requires the report to be published no later than 7 February 2026.

There is also a requirement for the London Borough of Hounslow to develop and publish an action plan within five months of the peer team being onsite: no later than 7 April 2026. This action plan should provide clarity on the activities, milestones and timelines that the council will work to in responding to the peer team’s findings. 

The action plan will also be central to the peer team’s re-engagement with the council through a progress review which is due to be completed by November 2026.

The Ministry for Housing, Communities and Local Government (MHCLG) have published the Best Value Standards for Local Authorities. These standards expect every council to engage in a Corporate or Finance Peer Challenge at least every five-years. 

Mona Sehgal, Principal Adviser for the London region, is the main contact between the council and the Local Government Association. Mona is available to discuss any further support and can be contacted at [email protected].

CPC is a valued improvement and assurance tool that is delivered by the sector for the sector. A team of councillor and officer peers undertake a comprehensive review of key information and spend four days at a council to provide robust, strategic and credible challenge and support.

CPC forms a key part of the improvement and assurance framework for local government. It is underpinned by the principles of Sector-led Improvement (SLI), which state that councils are responsible for their own performance; accountable locally, not nationally; share a collective responsibility for the performance of the sector; and rely on the LGA to provide the tools to support them. CPC is also key to councils in meeting their Best Value Duty. UK Government expect all councils to have a CPC at least every five years. 

Scope and focus

The peer team considered the following five areas which form the core components of all CPCs. These are critical to a council’s performance and improvement.

1. Local priorities and outcomes - are the council’s priorities clear and informed by the local context? Is the council delivering effectively on its priorities? Is there an organisational-wide approach to continuous improvement, with frequent monitoring, reporting and updating of performance and improvement plans?
2. Organisational and place leadership - does the council provide effective local leadership? Are there good relationships with partner organisations and local communities?
3. Governance and culture - Are there clear and robust governance arrangements? Is there a culture of challenge and scrutiny?
4. Financial planning and management - Does the council have a grip on its current financial position? Does the council have a strategy and a plan to address its financial challenges? What is the relative financial resilience of the council?
5. Capacity for improvement - Is the organisation able to bring about the improvements it needs, including delivering on locally identified priorities? Does the council have the capacity to improve?

Every CPC has a strong focus on financial sustainability, performance, governance and assurance.

The peer challenge process

Peer challenges are improvement focused; it is important to stress that this was not an inspection. The process is not designed to provide an in-depth or technical assessment of plans and proposals. The peer team used their experience and knowledge of local government to reflect on the information presented to them by people they met, things they saw and material that they read. 

The peer team prepared by reviewing a range of documents and information to ensure they were familiar with the council and the challenges it is facing. This included a position statement prepared by the council in advance of the peer team’s time on site. This provided information on the local context and what the peer team should focus on. The peer team also considered a comprehensive LGA Finance briefing (prepared using public reports from the council’s website) and an LGA performance report outlining benchmarking data for the council across a range of metrics. 

The peer team spent four days onsite at the London Borough of Hounslow during which they gathered evidence and views from more than 50 meetings, in addition to further research and reading. The team spoke to more than 85 people including a range of council staff together with members and external stakeholders.