£540m debt write-off shows Perry has failed on finances

CROYDON IN CRISIS: His political opponents say the elected Mayor ‘has sold Croydon down the river for his own political reasons’, and his 15% tax hike is ‘punishment’ for residents. By STEVEN DOWNES

Croydon’s council has been so “spectacularly useless” (© Ian Hislop of Private Eye magazine) that Tory Mayor Jason Perry is now asking the government to write-off £540million-worth of debt – one London borough asking for the equivalent of a quarter of Britain’s entire war debt after World War I.

Such is the massive scale of Perry’s request – which is believed to have the backing of the government-appointed improvement panel – that the matter has been making national headlines. No local authority has ever defaulted on its debt before.

Perry’s plea, on top of his 15per cent Council Tax hike inflicted on residents in the middle of a cost-of-living crisis, has now prompted his political opponents to accuse the Mayor of having failed on one of his key election pledges from less than a year ago.

Mayor Perry “is hell bent on forcing the highest Council Tax increase of any London borough on Croydon residents”, Councillor Callton Young, the deputy leader of the Labour opposition at the Town Hall, told Inside Croydon.

“Labour will oppose it,” Young said.

Peter Underwood: ‘Mayor Perry has failed’

As things stand today, it is looking very much like Mayor Perry’s Council Tax hike won’t get a majority vote of councillors at next Wednesday’s Town Hall budget-setting meeting, with two Green councillors and the borough’s Liberal Democrat also likely to oppose.

Peter Underwood, the Green Party’s candidate for Mayor last May, said today, “Jason Perry said he would fix Croydon’s finances, but he has clearly failed.

“He is putting up taxes, cutting services, and borrowing large amounts of money – exactly what Labour used to do but he is doing it even more.

“His only hope appears to be begging the government to write off some of the debt. If he can do that, then why can’t he get them to write off a bit more and reduce the outrageous rise in Council Tax he is forcing us to pay?

“What Croydon really needs is fair funding from the government – not more punishment for Croydon residents,” Underwood said.

Headline-making: How The Times has reported Croydon’s financial crisis today

It is a theme echoed by Claire Bonham, the borough’s only LibDem councillor. “Croydon residents shouldn’t pay the price for the mistakes of others,” Bonham said.

“Mayor Perry should try to get a better deal from his government, not punish our residents.”

Young, who has been a councillor since 2016, including a brief spell as a cabinet member under Tony Newman when he was leader, said, “Mayor Jason Perry is proving a nightmare for Croydon’s budget-setting process.

“He has negotiated with government and come away with a 15per cent hike in Council Tax for Croydon, in the middle of the worst cost of living crisis for 40 years, with food inflation at 16per cent and energy prices soaring. He could sell surplus assets sooner or use capital income to keep the Council Tax rise closer to 5per cent. But he won’t.”

Young does agree, however, that the borough’s debts need to be written off by central government.

“Part of Croydon’s financial position has been driven by the grossly unfair 2013 funding formula, which gives our borough half of what Lambeth gets per head each year.

Labour’s Callton Young: Mayor Perry ‘has sold Croydon residents down the river’

“In his ongoing negotiations with government, Mayor Perry must change this.

“But he must do better than his efforts on Council Tax, where he has sold Croydon residents down the river for his own political reasons.”

Even if Mayor Perry and the Tories are defeated on their budget next week, they get another chance seven days later, on March 8. That is when there is to be a second budget meeting, where it will this time take a two-thirds majority of councillors to block the Council Tax hike – and that would require at least 10 Conservative councillors to vote in the interests of residents, and against their party whip.


Read more: Government to write off £540m of council’s debts
Read more: The solution to Perry’s finance problem: Fund Croydon Fairly

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 Callton Young, Claire Bonham, Council Tax, Croydon Council, Mayor Jason Perry, Peter Underwood and tagged , , , , , , , , , , , , , , , , . Bookmark the permalink.

3 Responses to £540m debt write-off shows Perry has failed on finances

  1. David White says:

    If he wishes to avoid a revolt by residents Mayor Perry must now seek a meeting in person with the Secretary of State (Michael Gove). The Council’s delegation to such meeting should be made up of representatives of all 4 parties on the Council.

    The delegation should demand that the Government writes off sufficient of the Council’s debt to avoid cuts to services and anything more than a 5% Council Tax rise.

    Anything short of this would mean penalising the ordinary people of Croydon for something which is in no way their fault.

  2. H Grisdale says:

    The fact of the matter is also that Labour inherited a huge debt from the Tories when they took over from them. This point is almost always missed out and everyone just blames the Labour Council Team. Also we have much lower funding per head than other local London Boroughs like Lambeth for example and yet we as a borough have the extra responsibiity of ‘Looked After Children’

  3. derekthrower says:

    That is nice of Councillor Young condemning Part-Time for chaos in budget setting after being a member of the previous regime of Newman, Hall, Scott, Butler et al who seemed completely unaware that they were standing on top of a cliff and had falling off as recklessly ploughing on with a fantasy when reality was staring them in the face. Part time has been part of this budgetary debacle since the start of the last decade, but then again so has Croydon Labour since the mid part of the last decade.
    Council meetings are now descending into bald men comb fighting contests. It is the Croydon political class that has failed and the distinction of left and right masks that this has been a joint enterprise in complete failure. These completely inadequate groupings need to be removed and in a democracy there is only one way to rid ourselves of them. Other new people need to be introduced and old parties removed.

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