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Newman breaks his silence to tell Mail: I did no wrong

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CROYDON IN CRISIS: With the Penn Report into possible wrong-doing at the council expected to be released by officials shortly, the former council leader has responded to reports in the national press.
By STEVEN DOWNES

Tony Newman: hundreds of millions of public money lost, but no one to blame

The Daily Mail today became the second national newspaper this week to publish an in-depth report into Croydon Council’s financial collapse, which happened in 2020.

Tory Mayor Jason Perry’s 15per cent Council Tax hike and his extraordinary and unprecedented request to government to write-off £540million-worth of the authority’s debts has re-focused attention on the “dysfunctional” council.

Hundreds of millions of pounds of public money has been wasted in Croydon by Brick by Brick, the council-owned house-builders, and over the fiasco of the botched Fairfield Halls refurbishment, with insult then added to injury with the controversial £437,000 golden handshake on the departure of Jo Negrini as the authority’s chief executive.

The Mail’s report follows similar coverage earlier in the week in The Times, and comes on the eve of the release of the Penn Report, commissioned through the Local Government Association in the immediate aftermath of the council’s financial collapse.

Inside Croydon received a leaked copy of the Penn Report last September and has been publishing extracts from it since. Our full Penn Report archive can be accessed by clicking here.

It is one of a series of independent reviews of the maladministration, mismanagement and questionable conduct of senior council officials in the years from 2015 through to 2020. These reviews include two Reports In The Public Interest from auditors, Grant Thornton.

But the Penn Report, according to the Daily Mail, is “the most incendiary”.

It was written in early 2021 by former local authority chief executive Richard Penn. Croydon Council’s chief executive, Katherine Kerswell, has had the report under lock and key for two years, ignoring and resisting all calls for its publication and for Penn’s recommendations to be implemented.

Headline news: more than two years after the council’s financial collapse, today the Daily Mail has a special report

A meeting of the council’s appointments and disciplinary committee was convened at 10am today in Room 1.01 of Fisher’s Folly, the council headquarters The meeting would last more than five hours (including a break for lunch), with all but 30minutes of the meeting held in secret.

Kerswell has, finally, recommended publication of the Penn Report, but she has told the elected councillors who make up the committee that she will not allow any of its recommendations to be implemented, at least not until she has drafted yet another council paper and organised yet another meeting.

Penn recommended that some of Negrini’s senior staff ought to be reported to their professional bodies – CIPFA, the Chartered Institute of Public Finance and Accountancy in respect of its former Section 151 officer, Lisa Taylor, and possibly her predecessor, Richard Simpson, and to the Solicitors Regulation Authority for Jacqueline Harris-Baker, the former Monitoring Officer, the council’s most senior legal official.

In the intervening two years, external legal advisers Browne Jacobson and auditors Grant Thornton recommended similar courses of action. But still Kerswell stalls.

To compile his 160-page report, Penn interviewed council officials, cabinet members and councillors, council staff and some figures from outside the council. He discovered “organisational dysfunction at the most senior level”.

As the Mail reports today, “Staff who came from other councils say they were shocked at the way Croydon was run. One likened the town hall to the ‘Wild West’.

“There was a lack of transparency, interviewees claimed, bordering on cover-up… proper financial controls were not in place… inconvenient evidence, even from the council’s own legal department, was sometimes ignored… important paperwork was missing… failure was rewarded… democratic processes were not always followed.

“Too often those at the top also displayed an ‘almost reckless disregard of the potential adverse consequences of risk’.”

Room 1.01: inside Fisher’s Folly, where the committee spent more than four hours in secret session

For her part, Negrini, now a director at Arup, refused to comment to the Mail.

But her former political boss, Tony Newman, the Labour leader of the council from May 2014 until he resigned in October 2020, did provide a statement.

“Things can go wrong without there being any wrong-doing,” Newman told the newspaper, having lost none of his old arrogance.

Although he has expressed regret for the council’s collapse when he was leader, Newman has never apologised to the people of Croydon.

Little has been seen or heard from Newman since he stood down as a councillor in March 2021. He has been on “administrative suspension” as a Labour Party member for almost two years, the issues identified in the Penn Report hanging over him like some local government sword of Damocles, with nothing happening to resolve the situation until Kerswell gets round to actioning the report’s recommendations.

In his statement, Newman said, “Everyone who served as a councillor, myself included, truly regrets Croydon’s financial crisis, and the constraints it continues to put on public services and families in the borough.

“But it would be wrong to attribute Croydon’s problems just to spending decisions.

“Things can go wrong without there being any wrongdoing. Indeed, Croydon has suffered from chronic underfunding for over three decades and the past few years of austerity have been especially tough… we were unable to weather it because of years of underfunding and austerity, which left us with very limited financial room for manoeuvre.”

Discredited: former leader Tony Newman and Jo Negrini, the ex-CEO, to whom he handed a £437,000 pay-off

The paper also notes that Newman has insisted in the past that there was no wrong-doing on his watch and that he and senior colleagues, who “acted at all times with honestly and integrity”, had been the victims of a “politically motivated witch-hunt”.

Because, of course, it was a politically motivated witch-hunt that saw him push through the above-asking-price purchase of the Croydon Park Hotel, and it was a politically motivated with-hunt which saw more than £200million-worth of council loans shovelled into the money pit that was/is Brick by Brick.

And it was a politically motivated witch-hunt which saw Newman himself choose to chair a previous appointments and disciplinary committee where the decision was taken to pay £437,000 to Negrini to encourage her to leave her post after a breakdown in trust between her and… Newman himself.

As the Mail says in its article today, “The Penn report is a terrible indictment of the standard of local government in some parts of the country.”


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