The review was carried out by Max Caller after being commissioned earlier this year and presented to members on Tuesday.
Councillors were told the council’s working environment was “harmful” and that there was a “climate of fear and intimidation.”
It comes after a long period of poor relations between the council’s Conservative political leadership and its chief executive Daljit Lally, which broke down in 2020 after the CEO was suspended by the council’s former leader.
There were a number of ashen faces in County Hall as Mr Caller and the two members of his team – James Taylor and Gordon Mitchell – read the contents of the report, which were not circulated previously.
The report stated that the council had “lost its way” over the years to the extent that “leadership at both political and managerial levels is “distracted” and focused on “internal issues.”
Mr Caller told councillors there were some impressive officers at the authority but they had been let down by leadership.
He said: “Northumberland is a brilliant county doing some amazing things with some really good officers who have tried their absolute best to deliver for this council despite some problems that are highlighted. There is an issue in the council about trust and working together.”
There was also significant criticism directed at the chief executive, who did not attend the meeting. The meeting heard that the CEO had attempted to stop the review going ahead, with the report branding the situation “extraordinary” and appearing to demonstrate “a desire to frustrate and obstruct the process.”
Mr Caller added: “The fact of the matter is that instead of the leader making a reasonable request and getting an item on the agenda, there was an attempt to prevent this council having a review and reporting to it, no matter what it said.
“That is outside my experience of how things should be run,” he added, later branding it “unheard of.”
He also made reference to disciplinary process aimed at the CEO back in August 2020, when Mrs Lally was suspended.
Mr Caller said: “Most councils never run a disciplinary process at their chief executive, so there isn’t a lot of experience.
“Make sure that the charges you are bringing forward can be determined. You started in the wrong place and it is no surprise that you ended up in the wrong place.
“Where you’ve ended up is you can’t start those processes again on those charges, which is a disaster for both your chief executive and your council. She is neither exonerated, nor is the council able to pursue those allegations. You are stuck. That’s a really difficult position.”
The main recommendation of the report was that the county council needs to “establish what it means to be a best value local authority” and that to do it it needed “new, seasoned local government professional leadership at the top of the organisation.”
Mr Caller continued: “It is common ground with your chief executive and all the group leaders I have spoken to, that the council needs to move on and your current chief executive is not the person who is best able to carry that forward.
“You have a lot to be proud of and you have achieved some great things. But you could have done better.”
Coun Sanderson said: “Looking at the members here, I have very good relationships with almost all of you – and even the ones I don’t get on with I know we can work together. Please may we all work together to make this happen.
“The Conservative group will accept all recommendations today and I hope we all can.”
Coun Dickinson added: “We have to draw a line and move forward – but what we can’t do is pretend that it hasn’t happened and nod at the bits we like and shake our heads at the bits we don’t like.
“We need to look at the detail and put it right for the Northumbrians, because that’s what its about today.”
Independent councillor Georgina Hill, however, hit out at the council’s political leadership.
She said: “The report is damming. It is focused on officers, but I have seen former leaders and portfolio holders shaking their heads saying it is nothing to do with me.
“I think councillors have been let off the hook. It is them that have been in charge for the last five years.”
Mr Caller replied: “Anybody reading this report may think we might have been very measured – but we haven’t let anybody off.”
Councillors then voted to form a steering group – although Labour and the independent group abstained – to discuss the next steps before a second extraordinary council meeting on June 21, when the report will be debated further by members.
Speaking after the meeting, Coun Sanderson said: “I would like to thank Max Caller CBE and his team for the extremely thorough report which has studied in forensic detail many aspects of the council.
“While some of the findings may appear blunt this is exactly what we expected to find and this is very much another step in restoring good governance, transparency and accountability to Northumberland County Council.
“This is what I called for when I took office as Leader of this administration 12 months ago – creating a new culture of openness, trust and accountability, in all that we do.
“We need to study this report in detail but both councillors and officers will be getting to work straight away to address these issues that have been highlighted.
“I also want to reassure our residents, partners and staff that day-to-day work and the services we provide will not be affected – quite the opposite. We want to see real results and improvement in everything that we do and I am confident this review signals the start of a brighter future for the council.”