Site icon Inside Croydon

Lacey still spinning as he hangs on to his job at Brick by Brick

insidecroydon

It is not only the former council chief exec who has shown unconcealed contempt for the borough’s residents. Now, as our housing correspondent BARRATT HOLMES reports, the discredited head of the council-owned builders is pushing his luck, too

Contemptuous: Colm Lacey

Colm Lacey was last night effectively kicked off the board of Brick by Brick, the loss-making house-builders whose failure to deliver homes or revenues helped to bankrupt Croydon Council.

But he is refusing to resign from his job as the company’s chief executive, which comes with a gold-plated salary estimated to be worth £150,000 per year (we can’t confirm the precise figure, as in a style typical of his firm’s late delivery of housing, Lacey’s company has failed to publish its latest set of audited accounts on time).

An independent report published this week found serious shortcomings with the financial controls and management of Brick by Brick, which since it was formed in 2015 has received loans from Croydon Council worth £214million, yet has failed to pay back a single penny in profits or interest payments. By Brick by Brick’s own figures, in five years they have managed to build just 293 homes.

There are several BxB sites around the borough, well past their delivery date and still unfinished

Yet just hours before last night’s council cabinet was due to meet to discuss the damning report from Price Waterhouse Cooper and agree their recommendations to fire him from the board of directors, Lacey was spending yet more public money, after having commissioned expensive London PR spinners to brief the trade press about his own, and Brick by Brick’s, position.

There was no mention of him resigning his job, despite the amount of criticism the consultants at PwC and, before them, council auditors Grant Thornton, had heaped on Lacey’s head. Given the £440,000 pay-off for failure that his former colleague, Jo “Negreedy” Negrini, managed to screw out of the council, Lacey must be hanging on in the hope that he has a chance of getting a similar wedge.

“Croydon Council, our sole shareholder, is in discussions with government and others about its finances following the coronavirus crisis and their issuing of a Section 114 notice,” Lacey said, deflecting desperately as he was quoted in online trade magazine Building Design last night.

“We at Brick by Brick are working very closely with the council and their consultants to inform this discussion.”

This from the same person who just a couple of weeks before was boasting of how he was ducking and diving, like a shaven-headed Del Boy, doing deals to bring in extra investment in the failing company. As if any serious commercial organisation would have anything to do with the twerp.

As if to emphasise his determination to hang on to his job, Lacey said, “As CEO,  I remain resolutely focused on leading Brick by Brick’s immensely talented team to continue to deliver our high-quality development programme and I look forward to working closely with our new board members and the council as they develop future options for the company.’’

At last night’s cabinet meeting, even senior Labour councillors who barely six weeks ago were still clinging to the delusional party line that Brick by Brick was some kind of stunning success, and not the money pit under Lacey which had been demonstrable for at least two years, were admitting that it had all gone very badly wrong.

Leila Ben-Hassel: unimpressed with BxB’s ‘murky structures’

Jane Avis, part of Labour’s old team of councillors who were in charge of the Town Hall and who is now part of the new team running the council, described the convoluted corporate structuring of Brick by Brick which had superficially disguised its financial failings as “like Spaghetti Junction”.

Leila Ben-Hassel, who to her credit (and possible political cost) had been stingingly critical of Lacey in February, when he turned up for a scrutiny committee meeting with a business plan which had all its financial details redacted, said that Brick by Brick had “murky structures”.

The borough’s councillors have been criticised by auditors and consultants for the poor standards of scrutiny exercised over the past four years. But as Ben-Hassel correctly pointed out, she was one elected representative who did ask telling questions, but was simply ignored or treated with contempt by the likes of Lacey.

Referring to the committee meeting in which Lacey – as BxB CEO – actually said he did not know how many private house sales his company had made, and where he lied repeatedly over his company buying six sites from the council for £1 each, Ben-Hassel said it was “not a fruitful session”.

From the Tory opposition, Jason Perry pleaded with the council’s old-new leadership to halt all new Brick by Brick projects from starting. Residents living near some sites have been leafleted in the past few weeks, even as the council has been imploding, advising them that the house-builders intend to plough on with certain schemes, seemingly regardless.

Brick by Brick, Perry said, was an example of “total incompetence” which has been “a disaster for this council”.

“Please assure us,” Perry asked the old-new council leader, Hamida Ali. “Will you stop any new sites from starting? This must stop.”

Hamida Ali: the council’s  old-new leader

Ali, in her usual circumlocutory style in an earnest effort not ever to commit to anything, did offer some kind of undertaking to halt all site transfers to Brick by Brick. It is fair to assume, however. that she won’t be lying down in front of any Brick by Brick bulldozers on behalf of the residents of the borough any time soon.

There was, properly, concern expressed by Callton Young, the (genuinely) new cabinet member for finance, and Stuart King, the old-new cabinet member in charge of the council’s recovery programme, that steps need to be taken to protect the borough’s interests and not to jeopardise the many existing and unfinished building projects in which the council has millions invested.

This was the cautious approach advised by PwC’s team, which is now to embark on a second-phase review to explore the best ways of extracting the maximum value out of the wreckage created by Brick by Brick under Lacey.

Part of that task, according to Chris Buss, the former Wandsworth council official who led the PwC review of Croydon’s various companies, would be to unravel the complex arrangements in and around the Fairfield Halls.”Interesting” was the word Buss chose to describe the financial arrangements entered into by the council over the Halls, Brick by Brick and the housing to be built nearby to pay for it.

According to Perry’s Tory colleague, Lynne Hale, what had been presented by the council as a £30million payment to Brick by Brick for the refurbishment of the Fairfield Halls, which with over-runs had then cost £43million (at least), was now also subject to a council loan (another one), this time of £58million.

Hale asked if anyone, whether Ali or members of her cabinet, or council officials, or Buss, could offer any explanation for this.

And just as with the question of how Lacey is able to remain in a job at Brick by Brick, no one could.

Read more: Brick by Brick has paid nothing to council
Read more: ‘An accountant could have foreseen this more than a year ago’
Read more: Council forced to declare itself bankrupt


Exit mobile version