Further £38.4m to be sliced from next year’s council budget

CROYDON IN CRISIS: Town Hall leadership hoped to keep the latest round of cuts secret until after next week’s referendum, as the consequences of the borough’s bankruptcy start to hit home. EXCLUSIVE by STEVEN DOWNES

  • £12m of adult social care services to be transferred to the NHS
  • Purley Pool and leisure centre to be closed permanently
  • Three-quarters of Neighbourhood Safety Officer jobs to be axed
  • Council Tax benefits worth up to £25 per week be cut
  • 5% hike in Council Tax (as usual)

While much of the nation wrestles over the removal of the £20 covid uplift for those on Universal Credit, Labour councillors in Croydon have been making plans to axe Council Tax benefits from some of the borough’s most vulnerable – estimated as being potentially worth around £25 per week to some of those who currently receive the discount.

The measure is one of several new, deeper cuts being prepared as part of an additional £38.4million-worth of cost reductions to be implemented in the 2022-2023 Town Hall budget, as Croydon struggles to recover financially from effectively going bankrupt last November.

In the past few weeks, meetings have been held between senior elected representatives of both parties at the Town Hall and Richard Ennis, the council’s new finance director, to lay the groundwork for this latest round of cuts.

MP Steve Reed: driven Croydon Labour’s anti-mayor campaign

As career politician Steve Reed conducts a mayoral referendum campaign that suggests that instead of spending on another politician, the money might be better used on local services, Labour politicians at the Town Hall under Hamida “Apologetic” Ali have been deep in discussions about how to cut more local services in order to mend some of the damage they caused while they were serving under their previous “strong leader”, Tony Newman.

The Labour leadership – Ali, her deputy Stuart King and Callton Young, the cabinet member for not much in resources and little financial governance – had hoped that the pre-referendum “purdah” period might keep the lid on such bad news for the borough for a while longer.

Coming on top of the £44.7million cuts to council budgets being imposed this year, the depth of these latest cuts will certainly not help their case at next Thursday’s referendum vote for no change to the way the council is run.

A recommendation for the permanent closure of the Purley Pool and leisure centre is sure to cause huge dismay to the swimmers, gym bunnies and school groups in the south of the borough who feel that they have been stripped of one of the few pieces of local authority infrastructure in their area.

Cold water: Purley Pool campaigners seem set to be disappointed

The pool has been closed since the first covid lockdown in March 2020, and unlike other council-owned sports and fitness facilities, mostly located in the Labour-voting north of the borough and which have reopened over the course of this year, the doors at Purley have remained firmly locked.

Sources at Fisher’s Folly suggest that Purley had been operating at a loss – £187,000 in 2018-2019 and £123,000 in 2019-2020 – but this was subsidised by better income from other facilities managed for the borough by Greenwich Leisure. The real fly-in-the-ointment as far as 1970s-built Purley is concerned is the £3million-plus capital bill needed for repairs and maintenance to make it fit for continued use.

The Purley town centre site, including a long-empty Sainsbury’s supermarket, is likely to be viewed as a potential asset sale for the council, too.

Urgent surgery: the council’s cost-cutting depends on the local NHS taking on £12m-worth of costs

Possibly the biggest risk in the cuts being proposed for the council’s next financial year is about £12million-worth of adult social care costs, which the council wants to unload to the NHS.

This spending is mainly around the transfer of patients, many of them elderly and infirm, from hospital back to their homes.

The saving would represent almost one-third of the overall cuts proposed by the council’s finance director, but as one Katharine Street source said this week, “Who’s to know if the NHS will say, ‘Yeah, fine, we’ll pay for all that’?

“The NHS’s  budgets have been under huge pressure during the pandemic, too, and this proposal is staking a large chunk of the council’s budget savings on how the NHS’s own monetary settlement with the government pans out.”

Croydon’s cuts programme is the price of retaining local control of the council and warding off a government takeover.

Hamida Ali: hoped to keep budget cuts secret

Croydon issued a Section 114 notice in November last year, effectively declaring itself bankrupt, when it found no way of filling a £67million hole in its budget. An audit report accused it of “collective corporate blindness” that goes back several years, lax financial controls and a weak governance culture which failed to challenge poor spending decisions.

The government agreed a record £120million bail-out, over two years, on the basis that the council would deliver balanced budgets. On top of the cuts already made – with around 400 council jobs axed in 2020-2021 – this next round could be even harder to implement.

Previous proposals to close libraries and reduce the number of children’s centres around the borough have failed to survive a public consultation, leaving even bigger cuts to be made elsewhere.

Thus, like the welfare benefits advice team and graffiti-cleaning service, which were both axed in Round 1 of the cuts, so now the borough’s team of NSOs – Neighbourhood Safety Officers – looks like being ripped apart.

Cover story: NSOs are to suffer a massive cut

For a saving of about £1million per year, the council’s 47 NSOs and environmental enforcement officers are to be whittled down to a staff of just 14. “We will only be doing the bare minimum, those functions which are a statutory requirement,” our council source said.

There is a possibility that the council will seek “private sector partners” to fill some of the gaps, and generate a bit of easy cash, with the return to methods used under the Tories, bringing in a security firm whose bouncer-like staff would patrol the town centre doling out 60-quid fixed penalty notices for minor offences, such as dropped cigarette butts and littering.

The council’s mainstay for generating income, Council Tax, will inevitably be increased next April by the maximum amount allowed by law – 4.99 per cent.

This is likely to be felt hardest by the thousands of households around the borough who currently receive a subsidy from the council that reduces their bills, in some cases allowing them to pay no Council Tax at all. All that’s likely to go now, after Newman and his numpties crashed the council’s finances.

With the council in pre-referendum purdah until October 7, Ali, King and Young have not had to face any public discussion of this latest round of damaging cuts to public services. Conveniently – for them – despite Croydon still facing the twin emergencies of its finances and the pandemic, there has not been a meeting of the full council since July 5 – 13 weeks ago, one-quarter of the year.

They just might have to face the music over the budget when they reconvene at the Town Hall for a full council meeting on October 11 or, more likely, as they hold a cabinet meeting on October 18, when more details of their proposed service cuts should be made available. It might not be until December, when the government’s annual settlement for local councils is announced, that the full picture will emerge.

Tonight,  Jason Cummings, the opposition Tories’ shadow cabinet member for “Croydon renewal”, told Inside Croydon, “The reality of the council’s financial crisis and how it will affect residents is only slowly being revealed.

“For next year we know that £38million of additional cuts have to be found. The details of where the axe will fall should be being made public. Lack of transparency remains an ongoing failing of this Labour administration and the public deserve to know what charges will be going up, which community facilities will be being lost and the services and benefits that they will no longer receive.

“Councillors Tony Newman and Simon Hall may have gone, but nothing seems to have changed. It’s time we were told the full details of what is coming.”

Read more: ‘One of the best’ directors leaves council as Gateway closes
Read more: Newman excludes councillors from emergency budget details
Read more: Councillors were warned of financial crisis months in advance
Read more: Council forced to declare itself bankrupt
Read more: Conflicts of interest, incomplete contracts, unlawful payments

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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 inside.croydon@btinternet.com
This entry was posted in 2021 Mayor Referendum, Adult Social Care, Callton Young, Croydon Council, GLL - Better, Hamida Ali, Jason Cummings, Leisure services, Libraries, Purley Pool, Richard Ennis, Section 114 notice, Stuart King, Tony Newman and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

21 Responses to Further £38.4m to be sliced from next year’s council budget

  1. On 2 Sept 2021, this site reported that Hamida Ali aided by Kerswell had claimed to have turned the Councils finances around. Well just one month later that has proved to be a rather optimistic claim as they are now seeking these cuts which may not be the last.

    • The key word there, David, is “claimed”.

      Since her appointment was confirmed, Kerswell has been an absentee CEO.

      And Ali’s previous promises?

      Shush! £38m more cuts… let’s sneak them through and hope no on notices.

  2. No denying that this is the legacy of the abysmal administration in Croydon but the Tories have nothing to crow about either, given the lack of government support to local authorities. Policies such as addressing NHS needs by neglecting social care, cutting away the COVID19 support measures from those most in need, the failure to address the decline in business rates as shops close down are all part of the larger malaise, in Croydon and elsewhere. The cynical part of my mind also sees Labour London ‘levelled down’ as Boris looks to nurture his former red wall seats.

  3. Anita Smith says:

    Throughout this whole sorry mess, our town being forced into bankruptcy, and having to listen to the blame game coming out of Labour HQ, not once, from anyone have I heard the words “sorry”. The whole of the Mayor campaign would never have got off the ground if those who brought our town to its knees said “we got it wrong, we made bad decisions, but we are going to try and fix things”. Instead we have been fed lies, misinformation and ludicrous claims. It has been everyone’s fault but their own, they present themselves as the victims of circumstances outside their control. I have seen better accountability and behaviour from 6 year olds, at least they would know how to own their mistakes and say sorry.

    • If you haven’t heard any apologies, Anita, then you weren’t paying close enough attention around a year ago, after Newman stepped down (unapologetically), to be replaced by “Apologetic” Ali (we don’t just grab these monikers out of thin air, you know).

      This is what Hamida Ali said on Oct 23, 2020, after the release of the auditors’ Report In The Public Interest:
      “This report highlights serious issues with how the council has managed its finances in recent years.

      “These problems have deep roots, but I am sorry we got things wrong and I want to reassure our residents, staff and partners that my absolute priority as the council’s newly-elected leader is to put this right. While a decade of austerity and the covid-19 crisis have had a major impact on our finances they do not excuse the issues this report has laid bare.

      “The council fully accepts the findings and recommendations of this report and the council’s new leadership will take swift and decisive action to stabilise the council’s finances and governance.

      “My new administration is committed to a new culture which puts transparency, accountability and value for money at its heart.”

      She’s been apologising left, right and centre ever since. For Regina Road. For job cuts. For Veolia.

      It might be worth reminding Cllr Ali of her own words in the next few days…
      “While a decade of austerity and the covid-19 crisis have had a major impact on our finances they do not excuse the issues this [RIPI] report has laid bare.”

      • Ian Kierans says:

        Apologised – but failed to rectify issues.

        Still no transparency, accountability nor value for money.

        Exactly what has her administration actually done? So far it just keeps happening – calamity after farce after calamity.

  4. DEMOC says:

    Steve Reed and the Labour Leadership were telling Croydon residents that voting for a Mayor would lead to these cuts. Now we know the truth – they were planning the cuts anyway and trying to keep them secret till after the referendum on 7th. It’s the Labour Leadership’s reckless wastting millions of pounds that is causing the cuts. Croydon deserves better than this. Vote for change,. Vote for a Mayor on 7 October.

  5. Anita Smith says:

    Silly me. but a year is a long time in politics.

  6. Gerry Meredith-Smith says:

    Croydon can restore its finances, Croydon can have a new shopping centre, Croydon can improve its deprived areas, Croydon can stop spoiling its green spaces and family housing by allowing random poor quality development, Croydon residents can be proud of our town again. All that is required is fresh positive leadership, bringing the town together, harnessing the skills, resourcefulness and determination of Croydon people. Croydon is a major investment opportunity and it can and will succeed with the right leadership is and a creative positive approach. All we get from the Group leading Labour in Croydon is negativity and divisive comment.

    • “Good leadership” is not an automatic product of the mayoral system, Gezza. Have you not read what’s going on in Liverpool, or followed the shenanigans in the past in Tower Hamlets?

      It’s not the governance system that provides good leadership, but the calibre of the individuals who come forward, and sadly, because of the political duopoly that Croydon is shackled to, the people of this borough have had a series of duffers, liars and bullies served up, supposedly to serve them.

      Strong leader or elected mayor, if the candidates foisted on Croydon determine that they are to serve their political party first, and the people of Croydon second (at best), all we will get is more of the same.

      Why have Croydon’s Tories been so coy about their likely candidate to stand for mayor in 2022? Scared it might sway the vote the other way?


  7. Anita Smith says:

    if the Tory leadership has been coy about their likely candidate, then the Labour machine has been equally coy about their proposed candidate. They got rid of their one shining star (Jamie Audsley) and now they are stuck with A bit more shit from the same gene pool which produced Newman, Butler and Scott.

  8. Barbara Rudd says:

    Richard Ennis ….. the same Richard Ennis who Nathan Elvery brought into Weat Sussex ? Hope springs eternal – not !

  9. Eve Tullett says:

    As an employee, there is NOTHING left to cut, everything is gone. I struggle to find the words for how this will affect everyone for years to come.

    • Lewis White says:

      Eve’s post above really tells the awful truth of the matter. £38.4 million of yet more cuts?

      How many staff would be left?. How would the morale of the survivors be ? Would we have no litter bins, no grass cutting at all, no street tree maintenance , no play areas open, no bus shelters, no road markings, no youth activities ?

      Would any leaking roofs on Council houses be mended? Would libraries be open for half a day a week?

      Would pot holes be mended, or would the ones in the South of the Borough get so big that they merge, and could be touted by what ever regime is in power, as the “replacement for the Purley Pool”

      It sounds absolutely desperate. It is a wonder that anyone should want to stand for Mayor or Councillor or become a council Officer.

      One wonders whether everything will soon grind to a complete halt .

  10. Our new (fairly) Leader apparently thinks that just mouthing platitudes such as “I apologise”. “I am determined…” “I am appalled” is enough to buy off all blame for the past and all culpability for the present.

    There seems to be no action planned or considered which will genuinely get the council out from the wrong end of the copro-creek in which it now finds itself.

    Salvation can only come from a new leader, emerging from the mists to guide us to safer shores… a new Messiah Mayor. That’s not going to happen if the Mayor comes from one of the present parties and their current makeup.

    Labour is so obsessed with shooting itself in the foot while stabbing itself in the back to be able to put forward anyone at all. The Tories, similarly, appear to have been shopping in the Lacklustre Market for boring, party line following Gragrinds.

    We need someone like Andy Burnham or Ben Houchen or Andy Street, strong personalities with clear visions and ambition for their towns and cities, unafraid of the party hierarchies, principled and energetic… and with no past party debts to repay. If that doesn’t happen we are doomed, doomed, doomed.

    • Lewis White says:

      Och aye Private Fraser-Rabinowitz !. And apart from strong leadership and vision, we will also be doomed unless the Government supplies enough of another thing–money !

  11. Graham Norman Sleigh Bradley says:

    Agreed we need a stronger more visible and accountable leader. Kerswell have to say is just another cardboard cutout council clone from another merry-go-round. I am sure she now realise the chronic condition of Croydon and that it will be many years of hard graft before the ship is righted.

  12. Lewis White says:

    I assume that there is nothing to stop a husband and wife team, Mouse, Michael, and Mouse, Michaela, to stand for Mayor?

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