CROYDON IN CRISIS: Despite his committee being accused of lacking an ‘understanding of the urgency of the financial position’, one key Labour councillor shows no intention of standing down.
By political editor WALTER CRONXITE
For many residents and front-line council workers in Croydon, a thorough cleaning of the Augean stables at the Labour-controlled Town Hall is well-overdue.
Since November, when the council was forced to declare itself effectively bankrupt, no elected councillors have been sacked or had the party whip withdrawn.
In the month before the Section 114 notice was issued, two senior figures resigned their posts – Tony Newman, the leader, and Simon Hall, the cabinet member for finance. Both have since been suspended by the Labour Party, but they remain as councillors.
For the rest, it’s as if nothing ever happened. They have carried on, many still with the same positions – and still-generous allowances – that they held throughout the period which led to the council’s financial collapse.
The sense that many Blairite members of the local Labour Party remain in denial over their own part in bankrupting the borough was made crystal clear at last week’s local party meeting, when Newman supporters and friends were elected to key positions of influence.
There is another opportunity for the Town Hall’s ruling group to try to put things right, and replace some of those in cabinet positions when the Labour group of councillors – 39 of them, if you exclude Newman and Hall – stages its own annual meeting over two evenings later this month – on March 17 and 24.
But if Sean Fitzsimons is anything to go by, the signs are not good of any willingness to muck out those stables, or for anyone to accept responsibility for the monumental mess that has been created of the council’s finances.
Fitzsimons played a vital role in the running of the council under Newman.
Although never a member of Newman’s cabinet, Fitzsimons was put on the equivalent of a council cabinet member’s salary – £42,633.96 – after a £7,000 pay hike in 2018 for his role as chair of the council’s scrutiny and overview committee.
The position is not appointed by the council leader, but supposedly elected by the Labour group.
Thing is, during the Newman regime, the group always seemed to make sure it chose candidates that the leader wanted.
Fitzsimons has been chair of scrutiny since May 2014. And judging by his remarks this week, he intends to continue in that role until 2022.
That’s despite withering criticism of the part played by the lack-of-scrutiny committee, and therefore Fitzsimons himself, in reports published last year by the council’s auditors and a government-appointed inspector.
Even as the council’s financial collapse was going on around him, according to Grant Thornton’s Report In The Public Interest, Fitzsimons and his committee were failing in their vital task of holding Newman and his cabinet to account.
When the £65million budget gap was called-in to scrutiny in August last year, the auditors say that Fitzsimons’ committee failed to refer “the significant fact that the budget gap exceeded the available reserves to Full Council. In our view this was a failure of governance and showed a lack of understanding of the urgency of the financial position”.
This is but one of around a dozen criticisms of Fitzsimons’ committee’s performance in the Grant Thornton report, which also highlights no less than 10 separate areas where the scrutiny committee failed in its duty to challenge the financial games being played by those running Brick by Brick, the failed housing developer, and its supporters on the council.
The scrutiny committee, Grant Thornton’s accountants wrote, needed “… to show greater rigour in challenging underlying assumptions before approving the budget including understanding the track record of savings delivery”.
That might be polite, auditor-speak for accusing some of turning a blind eye.
They may have had one particular episode in mind, from the scrutiny committee meeting on August 25 last year. Faced with a doom-laden financial review, committee members, “raised a number of pertinent questions”. But when the council’s then finance director, Lisa Taylor, told the committee that she could not guarantee that she could avoid issuing a Section 114 notice – declaring the council bust – “Members of the Scrutiny and Overview Committee accepted the responses received and did not refer the matter to Full Council.
“In our view,” Grant Thornton say, “this did not demonstrate an understanding of the urgency of the financial position.”
The litany of failures of the scrutiny committee under Fitzsimons goes on, including the lack of oversight of the £100million asset acquisition fund that was used to buy the Croydon Park Hotel and Colonnades, which the auditors say, “indicates again the level of scrutiny and challenge by Members in respect of significant expenditure was not good enough”.
In instances going back to 2015, the scrutiny committee under Fitzsimons repeatedly showed “a lack of understanding”.
The Whitehall rapid review, which reported to Local Government Secretary Robert Jenrick last month, was no less unkind in its opinion Fitzsimons’ scrutiny performance. After the committee failed to get even a sniff of what had happened to the council’s vanishing cash, they said that Croydon scrutiny was found “not to have worked”, was “unchallenging” (just the way Tony Newman liked it) and that the committee, “… were not forceful in their challenge and did not refer key decisions back for the consideration of full Council.”
Yet despite all that, it seems that Fitzsimons intends to carry on.
Asked three times whether he would be seeking re-election at the Labour group meeting, Fitzsimons failed to offer a straightforward reply. He clearly has not taken the hint, from Grant Thornton or the Ministry of Housing, Communities and Local Government.
“I have not given any thought to what will happen next year,” he tweeted, a tad disingenuously some might think.
“As with the rest of the Labour group, I’m concentrating on council financial matters currently, and will make decisions regarding the next municipal year closer to our AGM.” Just a shame that he hadn’t concentrated on those financial matters a little sooner, others might suggest.
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