CROYDON IN CRISIS: More senior council figures could lose their positions as a result of the Report in the Public Interest which was released last night, as the Town Hall politicians take stock of its consequences.
KEN LEE reports
Half a dozen senior council figures have lost their positions in recent weeks in the middle of the financial collapse of Croydon Council, including chief executive Jo “Negreedy” Negrini and council leader Tony Newman.
But at the core of the council’s long-running financial problems could be the hitherto unexplained departure, in December 2018, of the then executive director of finance, Richard Simpson.
That’s the view of one respected council insider, as the borough’s politicians today began to react to the devastating criticism meted out to the council in auditors Grant Thornton’s Report in the Public Interest, which was released to the public last night.
The report highlights that the council has had deteriorating “financial resilience” since at least 2017 and that councillors failed to respond promptly to previous audit recommendations and concerns.
It was in 2017, of course, that the council’s children’s services department failed its Ofsted inspection, with the consequence that tens of millions of pounds were thrown at the problem to try to rectify the situation. But these unchecked overspends in children’s social care, and in adult social care, are among the chief problems with the council’s finances, according to the audit report.
Grant Thornton also say that the council’s reserves were not maintained at a sustainable level, and they found a myriad of other problems, with failures to manage school budgets, the unchecked spending on Unaccompanied Asylum Seeking Children and the runaway spending on failing “investments” such as Brick by Brick, the Croydon Park Hotel and the Colonnades.
Jason Perry, the leader of the opposition Conservatives at the Town Hall, said, “Sadly it is not at all surprising that Labour Croydon is subject to ‘A Report in the Public Interest’, the most damning of audit reports, which means that the public must be made aware of the financial fiasco caused by Labour.
“The writing has been on the wall for many years – the Labour cabinet simply didn’t care that their budgets were overspent and that the council’s reserves were frittered away, preferring to buy failing hotels and shopping precincts.
“Now the poorest and most vulnerable residents in Croydon will suffer as services are cut back, whilst the majority of the Labour cabinet who oversaw these failures remain in charge.
“Croydon deserves better.”
Some Labour councillors reacted to the report by questioning whether there could soon be more sackings or resignations from those in senior positions as a result of the Grant Thornton recommendations.
“This is damning,” said one.
“With Tony Newman, Simon Hall and the deputy leaders having resigned already, I’m now struggling to see how Sean Fitzsimons, the chair of the scrutiny committee, and Karen Jewitt, who chairs the General Purposes and Audit Committee, can survive in their posts based on what this report says about the lack of scrutiny and challenge around the council’s finances in the last few years.
“Newman never really understood finance and left it all to Hall,” said the Labour councillor.
“What is unforgivable was the way that Newman made sure, through his committee appointments, that the small number of Labour councillors with financial knowledge and budgetary experience were kept well away from budget discussions in the Scrutiny Committee and GPAC, so there was never any real questioning of Hall’s decisions.
“That was exactly the way that Newman and Hall wanted it and Labour councillors were unwilling to speak up for fear of losing their special responsibility allowances. This report is a direct consequence of that long-term cover-up.
“What is unacceptable now is how Newman and Hall have left it to new council leader Hamida Ali to offer the public apology.
“They haven’t issued a word of apology themselves. But then Tony always has been a coward.”
And an insider at Fisher’s Folly said, “Having read through the whole report, the noticeable theme is that these issues have been known about for the last few years which would suggest that Richard Simpson, the former executive director for finance, knew this was coming.
“He clearly got out before the shit hit the fan so that his reputation could stay intact.
“I know that elected councillors bear the ultimate responsibility, but clearly senior council officers have been involved in their attempt to disguise the severity of the situation. I know the feeling within the finance team for the last few years has been that it was inevitable that this would happen and it was only a matter of time before the wheels fell off.”
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