CROYDON IN CRISIS: Last week’s news that former chief exec Jo Negrini’s total reward for failure at the council amounted to an eye-watering £613,000 of tax-payers’ cash raised further questions about how such a payment was agreed and who authorised it.
After 18 months of careful and patient research, now many of those questions can be answered.
EXCLUSIVE by STEVEN DOWNES
It was a Thursday morning towards the end of that covid summer of 2020, with the August Bank Holiday weekend approaching, when a handful of senior councillors in Croydon were told that they needed to attend a meeting urgently to determine what to do about Jo Negrini.
The parlous state of Croydon Council’s finances was well-known. In spite of all the official denials, it was a matter of “when?”, and not “if”, as far as the impending bankruptcy of the borough was concerned. Labour-controlled Croydon was about to become only the second council this century to go bust, and Negrini was the council’s chief executive.
Inside Croydon had reported a week earlier that Negrini was on her way out; she was officially on annual leave, which was due to end on September 2. Now, on August 27, a decision was needed on the terms that would clear the way to avoid the need for her ever to return to Fisher’s Folly.
This was to be a special gathering of the appointments committee, summoned by Blairite council leader Tony Newman and Simon Hall, his finance “wizard” (with magical abilities to make money disappear), with only a handful of attendees – senior executives of the council and four other councillors.
It was hurriedly arranged and all held in secret. There would be no formal reports circulated in advance, as would normally be the case with important council business. Indeed, the councillors summoned were given nothing in writing at all, no report, no recommendations, not even an agenda. Just the 10.30am start time and the codes to log-in for the meeting which, in line with pandemic precautions, was to be held remotely.
The councillors soon discovered that they were being expected to agree to lavish the best part of half-a-million pounds on an exit package for a chief executive who had presided over some of the most egregious breakdowns in governance ever to be seen at a local authority in this country. “Collective corporate blindness” was the withering phrase used by the council’s external auditors in a special report to be published a little more than a month after this crucial meeting.
The Times would later describe the “culture of profligacy” at the council under Negrini (Hon FRIBA, remember…), that “far predates the pandemic and cannot be explained away by austerity or the area’s high demand for social care”.
The newspaper’s leader column said that Croydon Council “is a victim only of its own misjudgment”.
All those who logged in for that meeting on August 27 2020 have been tight-lipped since, but enough details have emerged over time to make it clear now that the council’s misjudgments were not confined to the appalling management of Brick by Brick, the dodgy deals done over the Fairfield Halls or the lack of controls on outsourced contracts, such as with the council’s housing repairs service.
Those misjudgments were about to be extended to the vast amount of public money to be given to Negrini.
What do we know about that meeting?
We know that the attendees were Newman, Councillor Alison Butler, his deputy, as well as cabinet colleagues Alisa Flemming and Hall. Making up the numbers were token Tory attendees, Councillor Tim Pollard, the then leader of the Town Hall opposition group, and Councillor Jason Perry, who was soon to succeed him as Conservative group leader.
Of this half-dozen, within weeks Newman and Hall had gone, resigning their cabinet positions and getting out just before that highly critical auditors’ report was published. Butler would stand down as deputy leader soon after, too, in the resulting Town Hall reshuffle.
By the New Year, Newman and Hall were suspended from the Labour Party and then resigned as councillors.
There’s never been any satisfactory explanation for Newman and Hall’s sudden resignations. They never really expressed any regrets; surely, if they had done no wrong, their resignations would not have been necessary?
Or did they decide to go to avoid being pursued, if they had remained councillors, for breaches of ethics, or even breaking the law?
Of the council executives who we have ascertained to have been present on that TEAMS meeting, all have long since left Croydon Council.
One of them – finance chief Lisa Taylor – quit Croydon after being suspended from duty in February 2021. She now holds a senior finance job at Birmingham City Council.
Another – Jacqueline Harris-Baker, the council’s senior legal official – resigned from Croydon in mid-2021 after a lengthy period on paid sick leave.
Also highly likely to have been in attendance at the meeting will have been a senior figure from the council’s personnel department.
We know from remarks that have been made by various participants that there were no papers circulated in advance of the meeting.
We know that some members of the committee – including both Conservative councillors – weren’t even told in advance exactly what the meeting was convened to consider.
We know that at the start of the meeting Harris-Baker – a lawyer not averse to having the council break the law on behalf of Negrini or Newman – outlined that the entire meeting was to be top secret, issuing blood-curdling threats as to what would happen to any councillor revealing to the public anything that was discussed.
A council official read aloud a report to the councillors. That’s right, a complex pay-off to the council’s most senior employee had to be read out to the voting members, apparently because they couldn’t be trusted to receive a copy of the report to read in advance. It was a method of meeting management that Stalinistic Newman was known to be fond of using, especially in his meetings of Labour’s Town Hall group.
It is understood that some parts of the top-secret document were made available on screen, to enable the voting members to read it for themselves (had the council officers involved never heard of “screenshots”?).
We know now that the meeting considered a package for Negrini which amounted to £437,000. Not bad as a reward for bankrupting your employer.
We know now that this payment comprised about one-third in the form of an immediate cash payoff and the rest, £292,851, in enhanced pension payments, equivalent to about 10 years’ worth of employer contributions had she remained in post until reaching retirement.
In addition to this generosity with other people’s money, Negrini was also paid nearly £177,000 in 2020 for the five months or so she was working at the council. It all added up to £613,000, the figure published last week by the Tax-Payers’ Alliance, making Negrini the best-paid council worker in the country that year.
At the meeting, when the matter of the exit package was put to a formal vote, not everyone was in favour. Minutes state it was “Resolved by a majority”. Best-guess is that the vote went 4-2, with Newman, Hall, Butler and Flemming all voting in favour of the deal.
There might have been more clarity on the matter had a request from Pollard been agreed that a record be kept of how people voted should be kept in the minutes. But Harris-Baker advised that such transparency would somehow be “unlawful”.
Harris-Baker even advised that it would be unlawful to record the number of votes for and against.
Not for the first time, it seems, legal advice provided by Harris-Baker appears to have been wide of the mark.
Voting at the appointments committee is covered in part 4F of the Council’s Constitution, the “Non-Executive Procedure Rules”.
Paragraph 10 sets out the rules for voting, with paragraph 10.2 covering the point explicitly as follows:
10.2 Where immediately after a vote is taken at a meeting of a Committee or Sub- Committee, if any Member so requires there shall be recorded in the minutes of that meeting whether the person cast their vote for or against the question or whether they abstained from voting.
It’s impossible to know for sure, but it seems very likely that the notoriously secretive council officials, together with Newman and Butler, probably never wanted anyone to find out who had voted and how. Together, they probably wanted to allow the perception to gain hold that the pay-off was agreed unanimously. It was not.
What remains an area of some conjecture are the reasons given to the members of the appointments committee for the need for the massive pay-off to Negrini.
Pollard has made some remarks at a subsequent meeting that he was immensely frustrated to be told that he couldn’t be told why it was imperative that Negrini should leave immediately. Just that it was. The best that anyone could manage was that it was “in the best interests of the council, corporately”.
If, as some Katharine Street sources have suggested, getting rid of Negrini was an attempt by Newman to deflect criticism from himself and to cling on as council leader, then it can go down as yet another expensive failure of his discredited administration.
In the event, the meeting was simply asked to accept that for undisclosable reasons it was imperative that Negrini should leave and be very well-rewarded for doing so.
The deal done, by the end of the same working day an official statement announcing Negrini’s departure was released by the council propaganda department. It had all the appearance of having been prepared in advance, as if the outcome of the meeting was always a foregone conclusion. There was, of course, no mention in the council press release of the very generous terms under which Negrini was leaving.
The council statement included suitably corporate quotes from Newman, as council leader: “I want to thank Jo for her dedicated service to Croydon,” he said, apparently seriously. He wished her all the best for the future, knowing that while hundreds of council staff were being made redundant on minimum terms as a consequence of her, and his, misjudgments, any blow to Negrini was being cushioned by that £437,000.
Negrini, remember, was officially on leave at this time. Yet she was available to offer a few quotes. The things money can buy…
For her part, Negrini’s public platitudes included the claim, “I am leaving with all the structures and the team in place to navigate through this post-covid period and see the council through the next stage in its journey.” But in reality, within six months, Negrini and five other members of her pompously titled “executive leadership team” were all on their way out of the council – the others without any generous pay-offs.
In the same six-month period, the council would also issue its Section 114 notice indicating it was unable to balance its budget, and Whitehall would send in a team of commissioners to oversee the running of the bankrupted, rotten borough.
After 20 years, today Tim Pollard is in his last month as a Croydon councillor. He is not standing in the Town Hall elections. When pressed to comment on the Negrini exit payment, he said, “Many residents tell me that, given the disaster enveloping the council at the time, it was clearly right that Jo Negrini had to leave.
“However, in the interests of transparency and accountability, this should not have been done through a secretive pay-off.
“The public still want to know exactly who is responsible for the catastrophe which enveloped the council in 2020. Because of the ongoing secrecy surrounding this shameful episode, we will never know what really happened behind closed doors.
“I did vote against the pay-off, and I did so because it felt morally wrong to spend that money without any explanation for the reasons and benefits. Perhaps it really was the only option available, but in the absence of any proper facts, how could I vote for it?
“It is a huge source of shame for the other members of that committee that they supinely bent to the will of Councillor Newman in creating a ‘fall guy’ for the catastrophic failures.”
For all the calls for root-and-branch reform of Croydon Council following its bankruptcy and the departures of Negrini, Newman and the others, there persists the very real sense that there really has not been the cultural change that was promised, and required.
It’s a toxic, secretive culture has been embedded at the council since before Newman was leader or Negrini was hired. For any new, executive Mayor taking charge next month, changing the council’s culture will undoubtedly be their greatest challenge.
Read more: CEO Negrini’s long campaign to shut down Inside Croydon
Read more: Watchdog suggests Negrini’s pay-off may have been unlawful
Read more: Council paid £25,000 for legal threats against Inside Croydon
Read more: The bottom line on the failure of ex-CEO Negrini: £613,895
Read more: Newman’s ‘sickening’ defence of Negrini’s £400,000+ pay-off
Read more: Negrini lands cushty consultancy with ex-council supplier
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