BEST VALUE NOTICE LIKELY TO CONTINUE AFTER AUDITORS FAIL TO BACK TVCA ACCOUNTS

Recent Audit Disclaimer Leaves the Tees Valley Combined Authority Facing prolonged Government intervention.

Taxpayer Backed Projects Supported by the Combined Authority Facing Further Scrutiny as Auditors Formally Reject the TVCA's Latest Accounts

16th Feb 2026

The Tees Valley Combined Authority’s hopes of escaping its Government Issued best Value Notice has suffered yet another significant blow, after its claimed external auditors are expected to issue yet another disclaimed opinion on the authority’s latest accounts — one of the most serious warnings that can be given about a public body’s finances.

The development, set to be revealed in papers which will go before the TVCA's Audit and Governance Committee this week, means auditors have been unable to obtain sufficient assurance over the authority’s financial statements following the extensive restatement of its accounts. In local government finance, a disclaimed auditors opinion is an explicit admission that the auditors cannot confirm the accounts present a true and fair view of the Authorities Activities for that financial period, further heightening tensions that Government Commissioners could soon be brought in to run the failing Authority.

For an organisation already operating under a Best Value Notice issued by central government back in April 2025, the implications are profound.

The notice — imposed after the Tees Valley Review identified serious governance and oversight concerns — can now only be lifted by the Secretary of State once there's clear evidence that financial management, accountability and internal capacity have been strengthened. However, its claimed the auditor’s findings now point the TVCA to be hurtling in the opposite direction, highlighting continuing weaknesses in the authority’s finance function and its ability to produce robust, timely and reliable financial information.

Failure across the board

Auditors are said to have identified two significant failings in value-for-money arrangements: the slow pace of implementing the recommendations arising from the Tees Valley Review and the limited capacity and capability within the finance team, particularly around the quality of the financial statements and the preparation of supporting working papers.

The concerns reportedly go to the heart of the government’s concerns over how the TVCA is being run, with the combined authority effectively being unable to demonstrate that its delivering best value if it cannot produce auditable accounts to the required standard, backed by a finance function with sufficient expertise and resilience.

The accounts simply cannot be taken as 'accurate'....

So Where's All the Money Going ?

The situation is likely to pile pressure on the Tees Valley Mayor ben Houchen to 'get his House in Order'...

The scale of the problem is said to be underscored by the fact that both the 2023/24 and 2024/25 accounts have had to be restated, with complex adjustments and a full audit trail required to reconstruct the authority’s true financial position. While senior officers reportedly told members that additional technical resources have been brought in and the finance structure redesigned, its claimed little in the way of progress has been made to address the now 'chaotic' state of the TVCA's finances.

Crucially, the Independent Advisory Board — which is monitoring the authority’s progress on behalf of government — is said to be in the process of making its own assessment to ministers, but the decision on whether the Best Value Notice is lifted rests solely with Whitehall, with a source telling the Teesside & Durham post last week that the lifting of the BVN against the Combined Authority looks to be increasingyl 'unlikely'...

Given that the notice was triggered by concerns over governance, transparency and financial oversight, the inability of auditors to sign off the most latest accounts is likely to be seen in Westminster as proof that the improvement process has turned into a complete shambles. There's also said to be wider financial risks still under active review, with work said to be continuing to assess whether both Teesside International Airport and the South Tees Development Corporation can service their borrowing — a question that goes directly to the long-term sustainability of the authority’s investment strategy and the potential exposure of the public purse.

Taken together, the picture seems to be an organisation collapsing under the weight of its own governance issues. The possible continuation of the Best Value Notice would mean ongoing government oversight of the combined authority’s operations, with ministers retaining the power to intervene if progress stalls once more. It also carries reputational consequences both for the TVCA & the Tees Valley Mayor Ben Houchen at a time when the authority is bidding for further devolved powers and funding.

And visibly cannot manage the powers it already has !