The council’s finances have gone into the red zone, according to CIPFA, and Croydon now has £1.4bn debt, the third-highest of any council in the country. But the Town Hall CEO says it is nothing to be concerned about.
By KEN LEE, our Town Hall reporter
Croydon Council’s £220,000 per year chief executive Jo Negrini has told the local government’s parish magazine that she’s “not sitting back waiting for calamity to hit”, despite the local authority where she has been in charge since 2016 being rated at high risk in six out of 11 categories by a nationally recognised finance and accountancy organisation.
Anyone note just a hint of complacency?
According to CIPFA, the Chartered Institute of Public Finance and Accountancy, Croydon is rated as “high risk” on six out of 11 of the indicators on their resilience index, including levels of reserves, rate of depletion of reserves, proportion of budget spent on social care and levels of debt.
CIPFA also has an adverse auditor’s opinion, which is judged by them to be an indicator of potentially poor governance.
As well as dangerously depleting the council’s reserves, Negrini’s council has managed to build up a mountain of debt, including at least £900million from the Treasury through the Public Works Loans Board, using the money to fund its ill-managed Brick by Brick housing scheme and the over-priced purchase of local commercial property.
Negrini issued her words of calm reassurance not to a full meeting of Croydon Council in the Town Hall chamber, where she is supposed to be held to account by the 70 councillors elected to represent the residents of the borough who pay her wages, but in a cosy interview for the small-circulation, in-house subscription mag for local authority wonks, the Local Government Chronicle.
“We are not sitting back waiting for calamity to hit,” Negrini told the magazine.
“It’s very clear that the system is completely broken due to social care. There’s too much demand for adults and children,” she said, absolving herself and her senior staff of any blame whatsoever.
This from the head of a council which has had its children’s services department in special measures since 2017 because executives had cut staffing levels so much that social workers could not cope with their caseloads, a council which has loaned £261million to an in-house house-builder which has delivered just three council homes in five years, and from a council that has run up £900million-worth of borrowings.
Negrini told the Chronicle that she recognised that Croydon was regarded as one of the councils most at risk by Cipfa but said she and her highly paid execs are aware of the risks it faced. The magazine reported that she rejected the suggestion the council would run out of reserves.
It is just over 12 months since Negrini’s deputy chief executive and much-respected senior finance executive, Richard Simpson, quit Fisher’s Folly somewhat abruptly. Negrini did not replace Simpson with anyone with a similar level of experience and expertise in managing Town Hall budgets in these tough times of Tory-imposed austerity, but instead chose to promote the Borough Solicitor, Jacqueline Harris-Baker. Negrini and Harris-Baker are said to work very closely together.
Negrini has been claiming that the council’s reserves will be increased – a recent council leader scrutiny meeting produced an embarrassing cameo where she had to correct Tony Newman, saying that the reserves would be improved in the next financial year, not this one. Her council’s medium-term financial strategy is due to go to cabinet t be rubber-stamped by Newman and his numpties next month.
The common excuse used by Newman and Negrini to seek sympathy is the council’s annual spend of nearly £10million on unaccompanied young asylum seekers arriving at the Home Office’s Lunar House. The Tory government refuses to pick up the bill for what is a national obligation being borne by the borough’s council-tax-payers.
“This is pertinent to the reserves level as we have a shortfall of government funding,” Negrini said. “We are carrying a £9million debt from day one every year.”
Yet that does not account for the multiple other areas of mismanagement and incompetence on daily display from her council, not least the soaring costs of housing the borough’s homeless, while failing to deliver homes for those on the ever-lengthening housing list.
Croydon now has £1.4billion debt, the third-highest of any council in England and Wales. Negrini says that 70 per cent of that money has been spent on addressing the housing crisis.
“Am I happy with that level of debt? I’m more concerned about our level of reserves than our level of debt.
“This administration’s absolute priority is around housing. We are very much embracing people here who are in housing need,” said the council exec who has managed to build three one-bed council homes since 2015 and has an in-house house-builder who never bothered to get itself registered as an approved vendor of shared ownership homes.
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