Our Sutton reporter, BELLE MONT, finds that the former chair of Sutton’s ruling party, John Drage, forgot to declare an interest during a multi-million-pound public tendering process. And not for the first time
The Liberal Democrats on Sutton Council accepted political donations from a contractor who was working for the borough’s social housing managers during a procurement process – and while the chair of the LibDems’ local party was on the decision-making board of the housing body.
Sutton Housing Partnership (slogan: “Improving housing together”) is the council’s social housing organisation, and what is supposed to be an ALMO, or arm’s length management organisation.
This week, Steve Tucker, SHP’s interim CEO, found himself with huge problems on his hands as the £8.9million cladding on the recently refurbished Chaucer House failed a fire safety test. Tests on the cladding of its sister tower, Balaam House, are in progress.
And now it has emerged that an SHP contractor made generous donations to the political party of a one-time SHP board member – John Drage, the former chair of Sutton Liberal Democrats.
Drage will be familiar to Inside Croydon’s loyal reader as the council official from Sutton who sat on the South London Waste Partnership committee that appointed Viridor to build and operate the incinerator on Beddington Lane in a 25-year £1billion-plus contract.
Drage was also on the Sutton council executive that rubber-stamped the Viridor decision in November 2011.
Drage never mentioned to the SLWP nor declared an interest at Sutton Council that he is a life-long friend with Viridor’s then CEO, Colin Drummond. Drage’s wife, Elaine, is godmother to one of Drummond’s sons.
Drage has long been a key supporter of local LibDem MP Tom Brake. Drage did not stand for re-election as a Sutton councillor in May 2014. Instead, he became chairman of the Sutton LibDem party, and the LibDems’ appointee as a director on the board of the Sutton Housing Partnership.
It was while Drage was on the SHP board that a series of questionable events occurred around a juicy £11million contract.
Smith & Byford Ltd, based in Cheam, first began working for Sutton Council on social housing gas installation and maintenance contracts in 2002. When SHP was formed in 2006, this work continued. The company was recontracted twice.
In May 2014, SHP began a new procurement exercise for the gas servicing, maintenance and installation contract on its social housing estate. The contract was for 10 years, and worth more than £1million per year. Smith & Byford won the procurement exercise and began the contract in July last year.
John Drage was appointed as a director on the board of SHP on September 10, 2014. At this time the gas installation and maintenance contract bidding process, initially involving 27 companies including Smith & Byford, was already under way.
On November 1, 2014, Smith & Byford Ltd donated £5,000 to Sutton Liberal Democrats (chairman: John Drage).
On April 28, 2015, Smith & Byford Ltd donated a further £2,500 to Sutton Liberal Democrats (chairman: John Drage).
At a board meeting of the SHP on March 9, 2016, Smith & Byford was approved as the recommended bidder for the service.
The contract was officially awarded on May 4, 2016.
On June 8, 2016, John Drage resigned as a director of SHP. He and Elaine Drage relocated from south London to the West Country, although Elaine Drage remains a director of the Sutton Carers Centre charity.
There is no suggestion that Smith & Byford’s donations were intended to influence the decision-making of SHP. The 2015 General Election was in the offing, and the then MP for Sutton and Cheam, Paul Burstow, was a regular visitor to Smith & Byford’s premises in his constituency.
The problem is that John Drage never made any declaration about the donations received by his political party at any board meeting of SHP, even when the board was voting to accept Smith & Byford as the recommended contractor. A bit like how Drage “forgot” to mention his lifelong friendship with Viridor’s Drummond when he a member of organisations awarding multi-million-pound public-funded contracts to Viridor.
In fact, an SHP official’s report from March 9, 2016, recommending Smith & Byford as the contractor, said that due diligence had been undertaken and nothing had been found to indicate a reason for not appointing Smith & Byford.
That due diligence clearly did not include looking at its political donations, which are a matter of public record.
The SHP constitution is clear regarding declarations of interests. It states: “Members should consider the following interests and whether they have any they should declare.
“Personal Interests: Where it can reasonably be thought that a matter will affect the well-being of yourself, a friend or a relative or an organisation/body with which you are involved, to a greater extent than other people. In this case you should declare the interest and state the nature of it.
“Personal and Prejudicial Interests: Where a personal interest is thought to be so significant that a member of the public, with knowledge of the facts, would consider it likely to prejudice the member’s judgement of the public interest. In this case you should declare the interest, state the nature of it and leave the meeting room.”
It seems inconceivable that, as the chairman of Sutton LibDems, Drage would not have known about the generous £7,500 in donations from Smith & Byford. It also seems odd that for a man who held a number of high-ranking and influential positions in public life, Drage has repeatedly struggled to remember to mention matters which many might consider very relevant to decisions involving billions of pounds of public cash.
There is no suggestion that Drage alone could have swung the SHP contract the way of Smith & Byford – only a thorough inquiry might establish the facts.
What really matters is public perception. And in the case of SHP, the perception of its residents would be vital to its reputation. The residents had been promised engagement and influence. In the summer of 2016, SHP’s then chief exec, Colin Taylor, said that SHP was able to announce long-term contracts with gas contractor Smith & Byford following a “very successful collaboration involving SHP and residents to choose the new contractor”.
SHP also claimed that, “We’ve had residents involved in this decision making at every stage, from finding out what the priorities are … through to evaluating the bids that have influenced who we appoint to deliver the contracts.”
Emphatically, SHP said, “Residents will be involved in choosing the new contractor.”
But these supposed resident consultations were something of a sham, as Drage himself revealed at a SHP board meeting in March 2016, where he said in relation to a similar procurement exercise that the final decision “rested with the SHP board”, with no outside influence.
Enquiries by Inside Croydon suggest that other SHP board members and management at the time had absolutely no idea about the donations made by its contractor Smith & Byford to Sutton LibDems.
The blame, it seems, lies squarely with Drage for failing to make a declaration.
SHP’s management of public property and finances has already been called into question recently, after it emerged that an administrative cock-up of epic proportions saw the housing managers lose more than £1million of Council Tax-payers’ money in 2013-2014, when it failed to invoice nearly 400 leaseholders correctly for works done. No executives were sacked for this debacle, but the matter was covered up for more than a year by Sutton Council officials and senior LibDem councillors.
Last autumn Taylor left his CEO’s job to set up a management consultancy, while the head of income, Cliff Haynes, took early retirement in February 2016. SHP’s executive director of finance, Brendan Crossan, moved on to sell… er… low-sugar biscuits. No details of any severance deals were made public following the departures of Taylor and Crossan.
Inside Croydon wanted to ask Niall Bolger, the chief executive of Sutton Council, what he intended to do about the apparent repeat failings of SHP. But he’s gone off on holiday. For three weeks.
Sutton councillor Tim Crowley, the leader of the Conservative opposition in Sutton, says he has written to Bolger and to SHP demanding “an immediate independent inquiry” into Drage’s failure to declare an interest.
Sutton’s Liberal Democrats, meanwhile, continue to receive donations from various companies that supply services to the local council and other related bodies, donations which are certain to come in for much closer scrutiny now than previously.
Inside Croydon has contacted the SHP, Tom Brake and Sutton LibDems, and William Smith of Smith & Byford with a series of questions to seek explanations for this latest oversight in accountability and transparency by John Drage.
None had responded by the time of publication.
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