Kerswell’s old council investigated for £16m housing fraud

Katherine Kerswell, Croydon Council’s £192,000 per year chief exec, has been on her holibobs (again) at least since Christmas Eve, and isn’t due back to oversee the crisis-hit local authority until the middle of next week.

Semi-detached: Katherine Kerswell hasn’t been around very much at the council

Which might all be a bit of a convenient absence while there is a multi-million-pound fraud investigation going on at another council where she had been in charge.

There is, at this stage, no suggestion that Kerswell is directly involved, but earlier this month it was announced that  £15.86million of cash allocated to Nottingham City Council’s housing stock was used on other services instead.

The money from the council’s ringfenced Housing Revenue Account had been incorrectly credited to the General Fund for all council services over a period from 2014-2015.

That includes the spell in 2020 when Kerswell was the struggling city council’s interim CEO, immediately before she was parachuted into cash-strapped Croydon at the insistence of Whitehall.

Kerswell was formally appointed interim chief exec at Nottingham City Council on May 1, 2020, in advance of the arrival of permanent appointee Mel Barrett. Long-serving chief executive Ian Curryer had departed a bit abruptly in April 2020.

For a long period, Kerswell was Nottingham’s CEO in absentia, conducting the Midlands’ city’s affairs from her living room in south London due to the covid lockdown, according to an interview in the Local Government Chronicle.

So it’s entirely possible she may have missed the shovelling of large wads of housing cash from the Housing Revenue Account into the council’s general fund.

As with all councils, the Housing Revenue Account is supposed to be strictly ring-fenced for transactions related to council housing landlord functions and cannot be used for other purposes.

For Croydon Council-watchers, the chain of events in Nottingham may appear eerily familiar.

A draft report on the issue was commissioned by Nottingham City Council from CIPFA, the Chartered Institute of Public Finance and Accountancy. The council says it is “acting without delay”, and that steps are being taken to refund the HRA from reserves.

Local opposition councillors (independents) have claimed to be “outraged” and said that “council tenants have suffered as a result of this. Repairs have not been done and [there have been] unnecessary rent increases”.

Twang: the city council’s company lost £38m

Nottingham is already under the watchful eye of Sir Tony Redmond, who has been appointed by the government to head an “improvement board” making sure the council can balance its books over the next four years,  in a process similar to that which is on-going in Croydon.

While Croydon Council was brought to its knees by Brick by Brick, Nottingham City Council had a failing heating company, Robin Hood Energy, which saw it receive a government bail-out. Robin Hood Energy went into administration in January 2020 (just before Kerswell’s virtual arrival at the council), losing the authority £38million.

And it appears that Kerswell is not the only senior local authority executive fluent in the vacuous language of councilspeak.

“This issue is being taken very seriously by the council and needs to be seen in the context of the significant progress being made with the work underway to improve governance, financial management and organisational culture,” was the best that Mel Barrett, Kerswell’s successor as Nottingham’s CEO, could offer.

Misusing nearly £16million of housing funding was, according to Barrett, “a setback for the council in the context of the significant improvement journey underway”.

Ahhh. One of those journeys…

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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
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1 Response to Kerswell’s old council investigated for £16m housing fraud

  1. I don’t think Kerswell will be at her Croydon desk this time next year.

    Her position was gifted to her and supported by our lame Croydon Tory and Labour leaders.

    Kerswell’s count-down has begun – she’ll be planning on what can be grabbed on the way out of the door.

    Nobody knows who she is, she have no attachment to Croydon and is just one of the career administrators who move from one over-paid council position to the next.

    In Croydon, we should call these types of people out.

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