Conflicts of interest exposed over councillor’s old pals’ act

WALTER CRONXITE has uncovered evidence which proves that former Sutton counciller John Drage failed to declare his friendship with Viridor’s Colin Drummond on occasions when public contracts worth billions were being awarded to his friend’s business

John Drage: over the course of five years, forgot to mention he knew Viridor’s CEO

In five years on the committee of the South London Waste Partnership, the then Sutton councillor John Drage was involved in the awarding of four major contracts to Viridor but never made any formal declaration of interest regarding his long-standing personal friendship with Colin Drummond, the chief executive and later chairman of Viridor.

Ultimately, SLWP – of which Croydon is one of the four member boroughs – awarded the Beddington incinerator contract to Viridor, worth £1 billion over 25 years.

The then Councillor Drage, who worked as an international financial policy specialist at the Bank of England, was appointed to represent Sutton Council on SLWP from its inception, in 2007. SLWP’s task was to find best-value for public contracts for its four south London boroughs – Kingston, Merton, Sutton and Croydon – on waste disposal and recycling.

SLWP’s first contracts were awarded to Viridor in March 2008, with a £120-million, 14-year household recyclables deal. Over the next few years, Viridor was awarded three out of four SLWP contracts – and the other supplier, EWC, was bought out a few years ago. Viridor is now the only service supplier to the SLWP.

Drage continued to attend meetings of SLWP until Viridor was given preferred bidder status for the £1 billion incinerator deal, in September 2011. Drage officially left SLWP in 2012.

In all that time, there is no record of Drage ever formally declaring to SLWP his 40-year friendship with Drummond.

It was not until July 2012 that Drage posted on the Sutton Council website any indication of receiving gifts or hospitality from Viridor’s most senior executive, Colin Drummond.

Drage has also been accused of being “manipulative and forceful”, and of threatening party sanctions against another Liberal Democrat councillor to ensure that they changed their vote and backed the granting of planning permission to the Beddington incinerator.

This news of the absence of Drage’s declarations comes ahead of tonight’s Standards Committee meeting of Sutton Council which will look into a £275,000 “gift” from Viridor Credits to the church attended by John and Elaine Drage. This information ought to cast strong doubts over the version of events so far accepted by the Sutton’s chief executive, Niall Bolger, and the council’s governance chief, Jessica Crowe.

John Drage, then a councillor, and the late Colin Hall were Sutton’s representatives on the SLWP at the meeting in November 2011 when it voted Viridor as the preferred bidder to build and run the incinerator. The following month, as a member of the executive committee of Sutton Council, Drage ratified Sutton’s acceptance of Viridor as the preferred bidder, also without making any declaration of his friendship with Drummond.

Viridor logoViridor won the Beddington contract narrowly. The underbid was technically superior, but Viridor was a bit cheaper. So finance – supposedly Drage’s area of expertise – was a critical factor in reaching the decision. Yet he has said that he held no sway in the reaching of the decision to hand £1-billion-worth of public cash from four local authorities to a company run by his lifelong chum.

After complaints were made recently to Sutton Council over Drage’s failure to declare his interest, the council CEO looked into the matter and determined that the former councillor never had a “disclosable pecuniary interest”, that is, did not benefit directly financially.

Yet Drage himself has stated that he now regrets not having declared his non-pecuniary interest at meetings of the SLWP and Sutton Council in 2011.

Through his wife, Elaine Drage, John Drage had known Drummond since their university days. Elaine Drage is godmother to Drummond’s son. But Drage says that they had not been in contact with Drummond for some time, including of his period on SLWP.

Drage states that he did not regard it as a significant relationship – or in the language of the Code of Conduct at the time, a “person with whom you have a close association”.

The events in question occurred prior to the Localism Act becoming law, and fell under the regime of the Standards Board for England. Under the 2007 Code of Conduct, in force at the time of Drage’s membership of SLWP, a “personal interest” was defined as:

An interest that is not on your register but where the well-being or financial position of you, members of your family, or people or bodies with whom you have a close association, is likely to be affected by the business of your authority more than it would affect the majority of:
• inhabitants of the ward or electoral divisions affected by the decision (in the case of authorities with wards or electoral divisions)
• inhabitants of the assembly constituency affected by the decision (in the case of the Greater London Authority)
• inhabitants of the authority’s area (in all other cases).

As Drage’s friend, Colin Drummond would almost certainly benefit financially from the SLWP incinerator decision, so the code appears to apply. In fact, the annual report for the Pennon Group – which owns South West Water as well as Viridor – for the year in question shows a spike of more £200,000 in Drummond’s total remuneration.

Old pals' act: Colin Drummond's Viridor salary went up by £200,000 the year his company was awarded the Beddington incinerator deal

Colin Drummond’s Viridor salary went up by £200,000 the year his company was awarded the Beddington incinerator deal

Drage has given his own account of events to the local papers: “At the time Viridor was declared the preferred bidder in 2011 I had not had any contact with Mr Drummond for several years and at no time since he had become CEO of Viridor. Hence, it did not occur to me at that time the fact I knew Mr Drummond on a purely personal basis – as a result of my wife’s having known him 40 years ago when they were at university together – meant I should have declared a non-pecuniary interest.

“It was only after Mr Drummond made contact with me in 2012, and invited my wife and I to two purely social functions (that we went to and I declared in the Public Register of Gifts and Hospitality), that I then felt I should declare a non-pecuniary interest when speaking to any committees dealing with the ERF. Hence, I declared an interest when addressing the Development Control Committee in April and May 2013.”

So all just a happy coincidence, then.

“With the benefit of hindsight (which is a wonderful thing),” Drage said publicly, “I now realise it would have been better if I had declared an interest in 2011 when Viridor was awarded the status of preferred bidder.”

Indeed he should, because Inside Croydon has obtained documentary evidence that shows the Drages were in direct touch with the Drummond family long before 2012, when John Drage claims Colin Drummond resumed contact.

And what Drage has stated publicly is also very different from what he has admitted in an email exchange with Nick Mattey, the Sutton councillor Drage has spent the past couple of months having thrown out of the Liberal Democrat party for daring to oppose the Viridor incinerator scheme.

In July this year, Drage wrote to Mattey: “Once Viridor had been selected by the South London Waste Partnership as the preferred bidder, because I knew Mr Drummond, I agreed with then Cllr Colin Hall that it would not be appropriate for me to stay as a member of the Partnership. So I stood down and was replaced in 2012 by then Cllr Roberts. I was not on the SLWP Committee when the decision was taken to award the contract to Viridor.”

This is an astonishing admission, and appears to contradict Drage’s earlier statement given to Sutton Council. It raises some very serious questions for the Standards Committee tonight.

The admission proves that in 2011, Drage considered his relationship with Drummond to be “significant” enough to step aside from the SLWP. It shows that he knew at the time there was a conflict of interest between his work on the SLWP and his friendship with Drummond. Yet he still failed to declare the relationship.

Rather than resign from his role on the SLWP, Drage’s admission shows that he entered into a secret agreement with the late Councillor Hall which was not known either to the SLWP or to Sutton Council. This arrangement effectively prevented another Sutton councillor from joining the SLWP as an active member.

At last night’s meeting of the SLWP, Stop the Incinerator campaigner Shasha Khan asked whether the SLWP would be launching an inquiry the recent allegations, including Inside Croydon‘s reports, regarding the controversial awarding of the incinerator contract to Viridor. Stuart Collins, the deputy leader of Croydon Council who chaired the meeting, said that he wanted an inquiry, but the representatives of Tory-controlled Kingston and Labour-run Merton determined that they would await the outcome of tonight’s Sutton Council Standards Committee meeting before making any decision.

 

With this written evidence in the email from John Drage, tonight’s meeting may have to ignore the recommendations of council officials, who appear content that nothing is amiss, and order an urgent, in-depth inquiry into the issues surrounding the award of the incinerator contract to Viridor.

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About insidecroydon

News, views and analysis about the people of Croydon, their lives and political times in the diverse and most-populated borough in London. Based in Croydon and edited by Steven Downes. To contact us, please email inside.croydon@btinternet.com
This entry was posted in Business, Croydon Council, Croydon Greens, Environment, London-wide issues, Nick Mattey, Outside Croydon, Refuse collection, Shasha Khan, Stephen Fenwick, Stuart Collins, Sutton Council, Waste incinerator and tagged , , , , , , , . Bookmark the permalink.

4 Responses to Conflicts of interest exposed over councillor’s old pals’ act

  1. Shasha Khan says:

    This is a very powerful piece. At yesterday’s SLWP JC meeting the Sutton councillors barely said a word in response to the allegations. Sutton’s councillors find themselves in a difficult position. To speak out against Drage would be political suicide as he is raja of the state Sutton, but surely they must feel that this neverending monsoon cannot be ridden through.

    Liked by 1 person

  2. whitgiftavenue says:

    I’ve been following this story with a growing sense of disbelief. The absence of a robust rebuttal from Sutton or any of the individuals apparently involved is disturbing, as is the succesion of these sort of stories afflicting local government in London. We really are in danger of becoming a bannana republic, without the benefit of having any bananas. And, at the risk stating the bleedin’ obvious, the virtual absence of any incisive coverage of this sorry saga in the local media is a depressing indictment of how irrelevant ‘conventional’ news outlets have become. Well done to all those who have lifted this stone and reported what was found underneath.

    Liked by 1 person

  3. davidjl2014 says:

    Yes it stinks doesn’t it. But who is Walter Cronxite? There is nobody on the electoral role in Croydon bearing this name. Someone inside the “establishment” is spilling the beans. Inside Croydon just wont reveal who the “insider” is. I wonder why?

    Liked by 1 person

    • Walter Cronxite is bestie mates with Bella Bartock, our arts correspondent, and Gene Brodie, our education reporter, among others.

      It is a journalistic device, David, which has been used over centuries, but obviously well over your head.

      Liked by 1 person

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