Hull faces Whitehall takeover

Hull council is set to become the first local authority to suffer a government takeover of its housing service.

Documents seen by Housing Today suggest the Audit Commission is poised to ask DTLR secretary Stephen Byers for permission to send in a team of experts. They would spearhead attempts to turn round a calamitous decline in both council and private sectors.

One of the city's MPs is deputy prime minister John Prescott. In 2000, as environment secretary, he created the housing inspectorate, which reports to the Audit Commission.

The commission's move is part of a corporate governance review that has found major managerial and political problems in the city.

The last government intervention took place to control Hackney council's chaotic finances, but this is believed to be the first takeover specifically related to housing.

The commission is expected to tell Hull councillors they must implement a radical programme to bring the running of the council and its housing services up to scratch.

Failure to stick to the plans could trigger government action. However, inspectors believe the depth of the housing crisis requires immediate action to aid the council.

The governance review was sparked by district auditor Paul Lundy's report in January. Lundy said he had given "serious consideration" to referring the council to Byers over its poor progress on best value. His concerns included five one-star inspection verdicts, with three on housing.

Among the problems identified were rent arrears increasing "at an alarming rate" to £7m, and 3,300 empty homes – almost one in 10 of Hull's stock.

Lundy also found the repairs system to be chaotic and wasteful, and a housing rents procedure that was unable to provide reliable rent income figures.

The inspectors' programme for action includes a drastic reduction in the council's 35,000 homes with accelerated demolitions.

And they want a massive consultation exercise with residents to improve often fraught relations between tenants and the council.

If appointed, the expert team would take forward Hull's pathfinder market renewal fund plans to tackle equally serious private sector problems.

The council is likely to plead for extra time. The commission's move comes just a week after the new Liberal Democrat-led administration took over from Labour in last month's local elections.

Independent Chris Jarvis took on the community services portfolio. He refused to comment on the report but confirmed its findings were critical of the council and "very worrying".

Jarvis added that he wanted to end the council's landlord role over five to 10 years. Community-led organisations should take over, he argued.

"The whole housing department must be reorientated to deal with private sector low demand and bad conditions," he said.

Prescott could not be contacted.

The Audit Commission refused to comment.