CROYDON IN CRISIS: It’s almost nine months since Whitehall released the last quarterly report from its Improvement Panel on the state of the cash-strapped council’s finances, prompting accusations of political favours for the Conservatives. EXCLUSIVE by STEVEN DOWNES
It’s not only indolent Boris Johnson who’s gone AWOL in the middle of a crisis.
Nothing has been heard for nearly nine months from the Improvement and Assurance Panel that was appointed by the Tory government to oversee the “recovery” of Croydon’s cash-strapped council.
And opposition politicians at the Town Hall smell a rat, claiming that the Conservative government is going easy on recently elected Tory Mayor Jason Perry.
The Improvement Panel, chaired by Tony McArdle, a regular government commissioner, was imposed on Croydon Council in early 2021, in the immediate aftermath of the then Labour-run authority’s financial collapse the previous November. When Croydon issued its Section 114 Notice, it was only the second council in England and Wales this century forced to admit that it had gone bust.
The previous council to fire the financial distress flare had been Tory-run Northamptonshire County Council, in February 2018. It was Tony McArdle, the one and same, who the government sent in then to sort out the mess in Northants. McArdle spent the next two years breaking up the county-wide authority into more manageable – and accountable – councils.
Croydon was the next troubled council McArdle was parachuted into, with him and his small team staring over the shoulders of officials and politicians as a condition of the government’s £120million bail-out of the south London borough.
McArdle and his panel were supposed to make formal reports back to the Secretary of State at the Department for Levelling Up, Housing and Communities once every 12 weeks.
To begin with, everything ticked along as it was expected to. The first couple of those reports went across the desk of Robert Jenrick.
Then, after Jenrick was sacked by Boris Johnson in September 2021, the Croydon reports started to be sent to his replacement, Michael Gove.
We know that Gove received, and had someone else read, at least one of McArdle’s committee’s reports because it’s there, on the government website, dated December 7, 2021. Gove even had one of his minions, Kemi Badenoch, send off a reply to McArdle, three months later.
When Gove himself was sacked by busted-flush Boris earlier this summer, Greg Clark assumed the responsibility as Secretary of State. It’s reckoned that Clark had two reports on Croydon sitting in his in-tray waiting for him when he arrived for his first day in the new job in July.
But Clark is unlikely to be in that job for long.
After “Thick Lizzy” Truss moves into No10 next month, as is widely expected to happen as a consequence of the Tory Party’s leadership election, who knows who will be the next poor sap to have to deal with Croydon’s civic mismanagement.
Since that Improvement Panel report in December last year, there’s been nothing but tumbleweed from the DLUHC regarding Croydon’s “recovery”.
There’s been no sign of the fifth report, which was due to be submitted to Marsham Street in March 2022, nor of report No6, which could have been expected this June, and might have been expected to include key details of the 2022-2023 council budget, which was passed in March (which then Councillor Jason Perry voted against).
The due date for the next scheduled quarterly report, No7, is September, now just a few days away.
The Improvement Panel’s March and June reports could have both been reasonably expected to deal with the thorny problem of the £73million of Housing Revenue Account money, which the council’s auditors say has been misappropriated by being used by the council on other areas of expenditure. As yet unresolved, that “missing” £73million is the prime reason that auditors Grant Thornton continue to refuse to sign off on two years’ worth of council accounts
After the £66million budget shortfall that led to the borough’s bankruptcy in 2020, if the council is ordered to “make good” that missing £73million from the HRA, then the cuts to spending that have hit council services so hard in the last two years could be expected to be ramped up even more.
This week, when approached by Inside Croydon, the Department for Levelling Up could not say when it will publish report No5 from the Improvement Board, although they did confirm that it had been received in Whitehall in March – nearly six months ago.
The churn of Tory ministers in Johnson’s chaotic government might have been a plausible excuse for this lengthy delay in making public the details of a process which was imposed on Croydon essentially to protect public finances.
Except that while the government has remained silent on Croydon matters for nine months, other commissioners that have been appointed to oversee other Labour-controlled local authorities, such as Liverpool City Council and Slough, have continued to deliver their reports into their local civic mismanagement, and the Tory government has not hesitated from making the contents of those public. So ministerial churn can’t be the reason.
There has been word on Katharine Street that McArdle and his panel have been sufficiently placated in the first 18 months of their task that they have already agreed with DLUHC to reduce the frequency of their reporting from once every quarter, to once every six months, making the next report due in September.
That much was confirmed by DLUHC to Inside Croydon.
But that does not explain entirely the hiatus since DLUHC last published the fourth report in March.
Opposition politicians at the Town Hall (and remember, the old Croydon political duopoly has been broken) think that Gove and Clark, probably after lobbying from Croydon Tories, have maintained their silence on the state of the borough’s finances for political advantage for the Conservatives.
“They probably thought that publishing the next report ahead of May’s local elections might have been unfair, whichever way things had gone,” a source told Inside Croydon. “And we know now how close the Mayoral election turned out to be.
“Undoubtedly, since then, in the full knowledge of what was in McArdle’s March report and after consulting with the improvement panel, someone in government has made the decision to keep schtum and give the new Tory Mayor some time to settle into the job.
“It stinks. Of course it does. What’s sauce for the Labour goose ought to be sauce for the Tory gander…
“But it is also very dangerous for the way the council is being run.
“Given how McArdle and his panel were so positive about the openness and accountability of the Labour council in the 18 months after the financial collapse, in particular the transparency around the reporting of the numbers every month, it’s appalling hypocrisy that they have given a free pass to Mayor Perry and the brains of the Tory operation, Jason Cummings, to keep the figures under wraps at least until next January.”
In a statement issued to Inside Croydon, a spokesperson for the Department for Levelling Up, Housing and Communities, said, “The London Borough of Croydon Improvement and Assurance Panel’s fifth report has been received by the Department.
“We anticipate the next Panel report being submitted in late September and we are committed to publishing all reports and will do so as soon as possible.”
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