Croydon in crisis: Emergency budget cuts may not be enough

EXCLUSIVE: There’s simmering discontent among the Town Hall’s ruling Labour group over their leadership’s inconsistent messaging, secretiveness and bungling, while the council’s new chief exec has made a good first impression. By STEVEN DOWNES

Breath of fresh air: council interim CEO Katherine Kerswell

“It’s like a fresh breeze through a fart-filled lift.”

Katherine Kerswell may have received more poetically worded plaudits during her 25-year career in local and central government, but the new boss at Croydon Council has certainly impressed on first impressions, both among her worried workforce at a briefing today, and with the borough’s Labour councillors.

Last night Kerswell addressed a meeting of the Town Hall Labour group – the first that council leader Tony Newman has dared hold since July, and a meeting which his henchman, Simon Hall, the cabinet member responsible for the state of the council’s finances, tried to have cancelled at the last minute. You can imagine why…

The Labour group meeting had been expected to be something of a showdown between Newman and some backbenchers who remain angry about the £440,000 “golden handshake” given to Jo Negrini, Kerswell’s predecessor as council chief executive.

In the event, given the depth of the council’s financial problems, the meeting had to be wound up at 10pm, with the promise of another virtual get-together before the end of the month. That “Any other business” item on the Croydon Labour’s agenda just keeps getting longer and longer…

Last night, Kerswell took the opportunity to introduce herself – Newman had kept her appointment a secret from the majority of his colleague councillors, too – and to run through the council’s financial predicament.

“I think Katherine Kerswell made a good first impression,” said one attendee.

“I liked the way she referred to ‘your’ problem and how ‘we’ would try to solve it,” they said.

No urgency: Patsy Cummings

The councillors were told that substantial cuts will be proposed in the emergency budget. A plan to balance the budget over three years will be worked up.

“Based on these cuts, I can’t see how children’s services won’t wind up being rated ‘Inadequate’ again come the next Ofsted inspection,” another worried councillor said. That bleak prediction would, of course, require a return visit of Ofsted inspectors, and that might be years away yet.

And while Kerswell set about winning the respect of the elected representatives, discontent among their number over their leadership’s secrecy and failure to consult on major issues continues to fester. “We’ve not been involved at all in any of this,” said one, “and yet it has been apparent since July that cuts were going to be needed.”

As well as Newman and Hall, some of the simmering disquiet has been reserved for Patsy Cummings, the cabinet deputy for finance. Cummings was one of the “Secret Seven” politicians appointed by Newman in June to oversee the work of the council’s financial review panel.

Backbench Labour councillors have described Cummings’ panel as “a waste of time”.

One said, “It didn’t actually appear to have come up with any tangible outcomes or input into the discussion on cuts and the emergency budget.”

Another said, “There’s no sense of urgency at all. Patsy’s working group has spent all summer doing fuck all.”

Someone else at the meeting said, “It seems to me that Patsy was used by Newman as a patsy.

“It enabled him to say that there was a group looking at financial and emergency budget matters. But Patsy and the panel – which had been carefully hand-picked by Newman and chief whip Clive Fraser – was never going to have any real input into the decision-making process. That’s typical Newman.”

Senior council finance staff have predicted that Croydon will run out of operating money by the end of this month. They have gone to the Ministry of Housing, Communities and Local Government to seek permission to borrow money just to pay the bills.

Secretive: Tony Newman

Even if the emergency budget is passed, there is no guarantee that Whitehall will being willing to assist. They may not approve the emergency budget, since it will not be sufficient to cover all the cash shortfall. They could ask for further cuts (which will be worked up as a Plan B).

“There is concern that the Croydon Tories, like MP Chris Philp, will play politics by lobbying Tory government ministers to refuse assistance or to attach some brutal conditions in order to undermine a Labour council – just as they have done with London Mayor Sadiq Khan over Transport for London.”

Sources at the meeting said it was unclear from the discussion whether such imposed conditions could extend to requiring Newman and Hall to tender their resignations from the council cabinet.

Inside the council, meanwhile, staffers are growing increasingly uncomfortable with Newman’s public rhetoric and how it fails to match the day-to-day realities within the cash-strapped council. With some departments facing cuts of 30 per cent to their agency staffing levels, one insider told Inside Croydon, “Newman talking about protecting services is an outright lie. No clever political nuance here. It’s outright deception.”

Council staff have been asked to categorise their work into “Statutory”, functions which the council has a duty laid down in law to perform, or “Business Critical” and “Discretionary”.

Political games: Tory MP Chris Philp

Said the Fisher’s Folly insider, “Anything in the latter is toast. No ifs or buts. That includes cost-avoidance work which is obviously massively short sighted.

“We need roughly £70million-worth of cuts in all to cover the overspend this year. We went to MHCLG before Kerswell arrived with a £35million overspend and were told to go away and come back with a smaller one.”

A question which arises from this is that, if the emergency budget does not satisfy Tory Ministers such as Robert Jenrick, will they even allow Newman and Hall to have a third try?

Patience with Croydon’s leadership is wearing thin, both in Whitehall and Katharine Street. The disbelief among Labour councillors over the generous terms of Negrini’s departure has not been helped by Newman’s latest attempts to justify his sanctioning of the “sickening” £440,000 payment. 

“Tony told the group on Monday that she was asked to leave because she was not delivering cuts quickly enough and her working relationship with colleagues was poor,” a source said.

“Then, last night, we were told that she had left by mutual consent. That’s probably because Tony was challenged on Monday as to why Negrini would be given a reward for failure if her performance was as bad as he had made out.”

“Tony hid behind the confidentiality excuse so as not to provide any further information.”

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
This entry was posted in Clive Fraser, Croydon Council, Jo Negrini, Katherine Kerswell, Patsy Cummings, Simon Hall, Tony Newman and tagged , , , , , , , , , , , . Bookmark the permalink.

3 Responses to Croydon in crisis: Emergency budget cuts may not be enough

  1. Moya Gordon says:

    It’s scary that incompetence and greed is putting people out of jobs. As a country we need tighter controls over the performance of local authorities/councils.

  2. Sebastian Tillinger says:

    I am not surprised Labour backbenchers are furious at the obscene payoff Tony Newman and Simon Hall (Dumb and Dumber) negotiated with Jo Negrini’s lawyers.

    Jo Negrini “was asked to leave because she was not delivering cuts quickly enough and her working relationship with colleagues was poor”.

    If you’re not performing in your job, there are HR procedures that can result in a fair dismissal.

    Tony Newman failed to ensure any corrective action was taken against Jo Negrini. And when it came to her being asked to go, her demand for £440,000 could not be challenged.

    Tony Newman and Simon Hall fucked the whole thing up and had to pay up.

    And don’t forget Tony Newman put this under-performing CEO in the job in the first place.

    Tony Newman is not fit to be Leader of Croydon Council. This is getting clearer by the day.

  3. Billy James says:

    Tony Newman is Croydon’s version of Derek Hatton…….

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