CROYDON IN CRISIS: Those found responsible for the £67.5m shambles of a refurbishment of the Fairfield Halls should not be allowed to get away ‘scot-free’, says ANDREW PELLING
Once they are elected on May 5, Croydon’s new executive Mayor needs to recruit forensic accountants to chase down the money lost, and, if necessary, use the law and even the courts to get as much of Croydon Council Tax-payers’ money back as possible.
Brick by Brick, too, needs special attention.
The council report ahead of Thursday’s Extraordinary Meeting at the Town Hall suggests that the council is in dispute with its wholly-owned firm of house-builders over a £600,000 fee.
The report states: “The Council has undertaken an initial analysis of the expenditure by Brick by Brick on the refurbishment work. While it is important to stress that this analysis has not identified any suggestion of fraudulent activity, it has identified an issue that is being more thoroughly reviewed.
“The issue relates to charges of £600k made by Brick by Brick to the council in relation to project management fees and charges. This has been highlighted due to the significant issues regarding the project management of the works raised in the auditor’s report and that these fees are approximately double the normal market level of fees.” I have added the italics, for emphasis.
“The chief executive has written to the directors of Brick by Brick seeking an explanation and to understand further this expenditure.”
Is there more to learn about the £600,000 fee and the handling of changes to consultants’ contracts?
The investigation on what happened needs to move on further into investigation into councillors. What did the council’s cabinet do in asking questions about the project? First, on what were the risks of the original Brick by Brick licence structure, and second, the Fairfield sleights of hand that proved to be unlawful.
When it was well known in the town that the Fairfield Halls’ renewal was haemorrhaging money what, if any, questions were posed by cabinet members?
There is no evidence that questions were asked.
Cabinet-level councillors should have asked as the shareholder of and banker to Brick by Brick for regular financial performance reports and asked questions about those reports.
All of those in the old cabinet under Tony Newman who are in the current council cabinet and who didn’t ask questions know who they are, and they should stand down.
Those who did or who complained that they were blocked from asking questions should proudly stay.
The changing of the guard was not completed when Newman was forced out.
It would help the campaign of the Labour mayoral candidate, Val Shawcross, if such a proper cleansing took place. I am just amazed that her campaign includes some of the same people who crashed the council.
Throughout this sorry saga, any questioning by me was regarded as “troublemaking”. A Mayoral candidate said of me recently that I exhibited “quirkiness” – but I think it is normal to ask occasional, polite questions.
Yet meanwhile, not charged by my party are those who mislaid £120million of public money.
Both political parties have been felled by arms’ length development companies – Croydon’s Tories had the CCURV, Croydon Urban Regeneration Vehicle – and these council-run businesses should be avoided. Brick by Brick was too ambitious. It might have been successful if it had started as the builder of 30 homes a year.
We should be building council houses instead.
What was clear from the outset was that Brick by Brick were not experts in refurbishing 1960s entertainment complexes. Brick by Brick was mainly staffed by former council housing officers with other skills.
Proper oversight over contracts by the council is needed when the cabinet has failed to ask questions over a four-year period. A weekly contracts committee, mainly held in public, would make sure that contracts are updated to be fit for purpose, contract costs reduced and fraud combatted.
Vitally, officers of the council should be appointed solely on merit and they should not be treated as “friends” of councillors, or vice versa.
And, as regards all that mysteriously lost money, we do not want people to get away scot-free.
Check out the Inside Croydon archive for some of our reports over the past three years which found serious failings with Brick by Brick and the Fairfield Halls refurbishment:
Read more: Negrini and execs ‘failed to ensure council was acting lawfully’
Read more: £30m Fairfield Halls project never went to competitive tender
Read more: Conflicts of interest, incomplete contracts, unlawful payments
Read more: Brick by Brick and the 18 documents officers want kept secret
Read more: Kakistocracy: Butler forced into £6m bail-out of Brick by Brick
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