CROYDON IN CRISIS: A former supporter of the discredited councillor has described it as ‘a disgrace’ that no one has ‘been held accountable for bringing the council to its knees’. WALTER CRONXITE, political editor, on growing concerns among local Labour members
Tony Newman, the Labour councillor who led the borough into bankruptcy, wants to stand for re-election in Croydon in 2022.
That’s according to colleagues within the local Labour Party, including some who have expressed concern about a “real risk of serious reputational damage” caused just by his continued presence as a councillor, which sees him still collect allowances at a time when more than 500 council jobs have had to be axed because of the “corporate blindness” of Newman and his numpties.
“He seems to think he can carry on as if nothing has happened,” said one. “It’s quite an astonishing display of shamelessness by him and some of his closest supporters.”
Another said, “He’s still taking part in decision-making, both within the Labour group and at council. He’s hanging around like a fart in a lift. And it stinks.”
Newman resigned as leader of the council in October, just a few days before a damning Report In The Public Interest from auditors Grant Thornton confirmed that the borough had been mismanaged for years.
This included Newman, as leader, authorising the borrowing of £100million for a council “investment fund” to buy a failing 4-star hotel and a struggling leisure centre, despite the decision having never been properly approved.
This week, in an interview with a little-read local rag, Newman lied about how that £100million was approved, claiming that it was scrutinised properly.
Last November, the council was forced to declare itself broke, issuing a Section 114 notice as it is unable to balance its budget due to a shortfall of £66million in this financial year.
According to Newman this week, that decision was “inevitable”. That’s despite Newman spending most of last year, while he was still at the helm of the Town Hall ship, steaming towards an on-coming iceberg, declaring that Croydon would not be issuing a S114 notice.
In the Report In Public Interest, the council auditors raised “serious concerns about how decisions have been taken about our finances and how they have been managed over recent years”, according to the council’s interim chief exec, Katherine Kerswell.
Newman has been a councillor for Woodside ward since 1994 and was Labour leader for 15 years until his resignation. As council leader, he was receiving £54,000 a year in allowances.
As a councillor, Newman continues to receive the basic allowance of £11,463.
It was Newman who fiercely attacked any Labour colleagues who dared question the decision to hand £440,000 in a golden handshake pay-off to Jo Negrini, the chief executive who was promoted into that job by Newman and who in three years managed to double the council’s debt to £1.5billion.
Sources who know Newman well say that they cannot recall a time when he actually had to work for a living. Others suggest that his recent behaviour suggests that he is in denial over his role in the council’s financial collapse.
“He’s delusional,” one councillor told Inside Croydon today.
A party colleague said, “Tony’s been turning up for CLP and other meetings, and it’s clear that he has no intention of resigning as a councillor.
“We’re going to have huge problems if he gets re-selected again for 2022. Who will want to go out and campaign for candidates so closely linked to the financial failure of the council? Who would want to stand as a candidate alongside them, either?
“There’s a real risk of serious reputational damage to the party locally because of the decisions and actions of Tony and his close colleagues,” they said.
One big fear is the impact the council’s financial collapse will have on the electoral prospects of Labour MP Sarah Jones in the marginal Croydon Central parliamentary seat.
At group meetings held since Christmas, senior Labour councillors have gloomily admitted that their party will not only lose control of the Town Hall in 2022, but they may not be able to win council elections in Croydon again until 2030 because of the damage caused by Newman and his clique.
In 2017, ahead of the last council elections, there was no selection meeting for Newman’s Woodside ward, where he and fellow councillors Paul Scott (Newman’s close friend) and Hamida Ali were automatically put forward as candidates by a decision of local party officials.
Ali, of course, succeeded Newman as council leader.
Croydon Labour’s failure to distance itself from the creators of the council’s financial disaster is something which many fear will not be easily forgiven by voters, even their own party supporters.
Some are asking why the party whip has not been removed from Newman and the likes of Simon Hall and Alison Butler.
Others have asked why there’s been no intervention from the party at regional or national level – before they are swiftly reminded Newman & Co have a friend in high places.
The Labour Party General Secretary, David Evans, is a long-time friend of Newman, is the father of a daughter with Butler, and his Croydon-based company benefited from a series of generous council contracts while Newman was leader.
However, the calls from grassroots Labour members and council staff who are in fear of losing their jobs grows louder by the day.
This week, at a virtual rally organised by Town Hall trades unions, one official hit out at the bungled handling of the council’s affairs by Newman and others which has forced hundreds of job cuts.
“The council ignored auditors’ concerns for over three years and was accused of ‘corporate blindness’. It is the services, community and the staff that will pay the price,” said the union official.
“It is a disgrace that the council is in this position and yet no one has been held accountable for bringing the council to its knees. Why should we pay the price?”
The remarkable thing about this condemnation of the borough’s failed political leadership is that it came from Yvonne Green, a Unite union convenor at the council who has been, for most of the past decade, an official within the local Labour Party who has worked as a trusted aide of Newman.
For his part, Newman broke his public silence this week, though his remarks did little to allay concerns among Labour members or Council Tax-payers, as he continues to refuse to take responsibility for his major role in the council’s financial collapse.
In a somewhat soft-focus “interview”, where Newman together with his former finance chief Hall were allowed to draft considered, joint responses to emailed questions, the discredited ex-council leader was still managing to blame everyone but himself for the calamity inflicted on the borough and its residents.
Some parts of the published responses are recognisable as the bombastic style typical of Newman. In the replies, he manages to suggest suggested that he is in some way offended because others have “personalised” the issue because they have identified him and his clique as having made a succession of very bad decisions.
“The most worrying thing, apart from the denials, is that it all underlines how for six years this council was being run by Laurel and Hardy,” said a Katharine Street source.
Apparently (at least, according to Newman and Hall), because the auditors’ report did not mention Newman or Hall specifically by name, Grant Thornton’s criticism of their failed leadership and financial management does not apply to the ex-council leader and finance chief.
“As local councillors who both live in our wards, our boss is the electorate and it is in them we place our trust,” was one answer given by Newman and New Addington councillor Hall which strongly hinted that both will attempt to stand for election in 2022.
Just hours before he resigned as leader, Newman had given another media interview – conveniently cosily, to the brother-in-law of a Croydon Labour councillor who Newman had on the Town Hall pay-roll – in which he suggested that his administration would survive. But this week, Newman was telling the world, “The issuing of a Section 114 became sadly inevitable as we went through last year.”
That certainly contradicts what bullish Newman and Hall had been telling colleagues at private Labour meetings – before they both jumped ship.
Neither Newman nor Hall seem to realise that, despite coronavirus, no other local authority has been forced to issue a S114 notice. Nor do they seem prepared to admit that under their leadership, they had run down the council’s reserves to dangerously low levels. Or that for three years in succession, they had been given stern official warnings from the auditors about the risks they were taking by holding such low reserves.
“With hindsight, as 2020 went on, spend on key areas increased unsustainably, especially when the government failed to deliver on its commitment to fund councils fully, instead of leaving Croydon £38million short,” Newman-Hall/Laurel and Hardy said. Of course, as the S114 notice revealed, also leaving the council short – of £36million this financial year alone – was the Brick by Brick housing company to which they had authorised the lending of more than £210million since 2015.
They even chose to contradict the auditors’ findings about the decision-making process over borrowing for the Croydon Park Hotel purchase.
In the Report In The Public Interest, Grant Thornton said of the council’s asset investment strategy, “The first purchase under the strategy was Croydon Park Hotel in August 2018, which was before the strategy was approved by Full Council in October 2018 using guillotine procedures. Good governance would require a strategy to be approved prior to the first purchase, indicating a lack of transparency in the decision-making process.” Our italics.
But according to the two men behind that unscrutinised £100million gamble with public money, “The decision on Croydon Park Hotel was subject to detailed formal scrutiny and that decision, along with the policy for future investments such as the Colonnades, was approved on a cross-party basis.”
So, as far as Newman and Hall are concerned, it is a matter of, “Nuffink to do with us, guv…”.
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