Eat humble pie, Hull councillors told

Council managing director Jim Brooks will ask councillors to endorse a response to the Audit Commission's damning report from earlier this year. An action plan for housing and other services aims to stave off formal government intervention. But Brooks warns that if progress is not achieved and maintained, a hit squad could be sent in at any time and the whole council could be suspended in a case of extreme failure.

The greatest challenge is likely to lie in gaining all-party acceptance of the plans. Labour, which was in power until May, has so far rejected the commission's findings.

Brooks warns in his report that all councillors must sign up to the sea change needed. "The opportunity to put things right without government intervention is one which we must seize," he says.

As a first step to bringing the housing finances under control, community services director Tom Hogan recommended drastic cuts to a flagship heating and insulation scheme. There are fears that improved homes will have to be demolished through lack of demand.

Audit Commission director of inspection Paul Kirby is to leave next month. Kirby launched Hull's corporate governance report in July.