CROYDON IN CRISIS: The same committee which met in August 2020 to agree the £437,000 payment to the departing CEO today decided to ignore the advice of senior lawyers and spend more council cash in trying to recover the pay-off. By STEVEN DOWNES
Reward for failure: ex-council CEO Jo Negrini
A council disciplinary committee has today agreed to pursue former chief executive Jo “Negreedy” Negrini for at least some of the £437,000 “golden handshake” that she was handed when she left the council just before its financial collapse in 2020.
The decision was reached by the council’s appointments and disciplinary committee – effectively the latest iteration of the same committee that agreed the payment to Negrini two and a half years ago.
And the move comes more than two years since it was a key recommendation of the Penn Report into possible wrong-doing at the council over its various property misadventures, the bungled refurb of the Fairfield Halls and the failed housing company, Brick by Brick.
But today’s decision contradicts the legal advice obtained by the council last year, and published by Inside Croydon, that said that while the council would have “a better than evens chance” of success if it brought a court case against Negrini, the costs involved would be prohibitive while the amount of money reclaimable would be limited.
The committee also agreed to submit formal complaints for unnamed former senior staff and councillors to their professional bodies or to the Metropolitan Police. Among those thought likely to be on that list are Tony Newman, the discredited ex-leader of the council, and Shifa Mustafa, one of Negrini’s most senior exec directors at the council, whose responsibilities included the Fairfield Halls and Brick by Brick.
On the list: former council leader Tony Newman
This action, too, was all recommended by Penn more than two years ago.
It is understood that among those to be reported to the police will be Simon Hall, the former cabinet member for finance, who is expected to strongly refute any charges of misconduct in public office.
The committee also had cross-party agreement that the executive Mayor, Jason Perry, should write to Michael Gove, the Levelling Up Minister, to complain that the law as it stands is inadequate for dealing with those responsible in cases such as the “catastrophic” financial collapse of Croydon Council.
Negrini had joined the council in 2013, originally appointed to oversee development and regeneration in the borough by the then cabinet member in a Conservative-run council: Jason Perry.
Today Perry said, “It is completely unacceptable that individuals who held positions of trust should escape the consequences of their misconduct. Nor should they be rewarded for their failures while our residents, businesses and partners continue to pay the price.
“They must be held to account.”
The committee met in Fisher’s Folly this afternoon – Perry as chair, together with Conservative councillors Lynne Hale and Jason Cummings, and Labour councillors Callton Young, Enid Mollyneux and Patrica Hay-Justice, who was substituting for Labour leader Stuart King who was absent, unwell.
Room 101: the meeting lasted three hours, but barely one-third of that time was in public
The meeting lasted three hours, with barely one-third of that time in the public domain.
The public furore over the huge and controversial pay-off to Negrini, as was first revealed by this website, is seen as having driven the decision to pursue her for a return of some of the cash.
As Inside Croydon was also first to report, the circumstances of the appointments committee meeting in August 2020 where the decision was taken to pay Negrini her “settlement” has also been cast into some doubt, and was possibly unlawful. That committee meeting was chaired by Newman, despite Negrini’s reason for leaving being a breakdown in her relationship with the council leader.
The committee’s decision today was drawn from paragraph 14.23 of the Penn Report, which contained the following recommendation: “The investigation has raised concerns about the actions and inactions of the former chief executive who is no longer employed by the council.
“It is recommended that members consider a review of the settlement agreement that was signed by the council with the former chief executive and whether the concerns raised in this initial investigation constitute a repudiatory breach of her contract and thus a breach of the terms of the settlement.”
The council described its decisions today as “unprecedented action to hold former senior leaders to account for misconduct, wrongdoing and failures in governance”.
The council issued a statement which said, “In what is thought to be a first for local government, members have given their backing for legal action to recover as much of the settlement payment to former chief executive Jo Negrini as is legally possible.
“The council will also be referring a series of reports on the council’s failures to the police; and referring individuals to relevant professional institutions who operate a disciplinary code in relation to their membership.”
Mayor Perry has got a busy couple of days of letter writing ahead of him, because as well as Gove, he has been tasked to contact the Committee on Standards in Public Life, the chair of the House of Commons Select Committee on Local Government and CIPFA, the Chartered Institute of Public Finance and Accountancy, “asking them to urgently review councils’ powers to hold individuals to account for catastrophic failures in governance”.
Inaction man: Mayor Jason Perry has taken 11 months to act on the Penn Report
The committee also received the Kroll Report – what the council describes as “a forensic investigation” into the omnishambles around the £67million unfinished and below-standard refurbishment of the Fairfield Halls by dodgy building firm, Brick by Brick.
No details have yet been released of the content or recommendations of the Kroll Report.
Perry said, “The scale and severity of Croydon’s financial collapse is unprecedented and that is why we are recommending unprecedented steps. The council has issued three Section 114 Notices; it has had to make savings of £90million over the last two years and another £36million this year; it has £1.6billionn toxic debt in total and has had to seek permission to borrow £369million from government.”
Today’s meeting was told that Croydon is now spending £66million per year in servicing its debt.
“I have consistently pushed for the council to take the strongest possible action against those responsible,” Perry said.
“I will also be making the case to government that councils must have greater powers to hold former officers and members to account for misconduct – without risking further costs to the taxpayer.”
- Check out some of our archive of coverage, in which we published extracts from the Penn Report:
- Penn Report wanted police probe into possible misconduct
- No referrals sent to staff’s professional bodies
- Negrini staged a power-grab over councillors
- Cover-ups and denial over Brick by Brick failure
- Men who led council to bankruptcy say they did nothing wrong
- Inside Croydon – as seen on TV! – has been delivering local community news since 2010. 3million page views per year in 2020, 2021 and 2022.
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ROTTEN BOROUGH AWARDS: Croydon was named among the country’s rottenest boroughs for a SIXTH successive year in 2022 in the annual round-up of civic cock-ups in Private Eye magazine
And about time these people were pursued
Phrases like “Too little, too late” and “Shutting the stable door, long after the horses have already bolted” spring to mind here.
Good news, and about time too. Now go after Lacey, Butler and Scott
It is good that the professionals involved in making this disaster are finally being reported to their professional bodies for the misconduct in creating it. This is clearly a cost effective measure that will put on the record wrong doing.
Recovering the outstanding full redundancy payment is another matter unfortunately. If we want a symbolic act to punish Negrini all well and good, but unless Negrini capitulates very early on in proceedings this will be a pyrrhic victory costing the Council Tax Payers more in expenses than recovery.
Their used to exist more extensive measures such as the surcharge which the Blair Regime in their infinite wisdom removed from the statute book. It is clear some similar measure are always required to concentrate the minds in local government who have access to such huge amounts of resources.
One of the most most tragic things about this is the £66 million that goes towards servicing debt every year. That’s £66 million that could go towards having improving services and having a balanced budget, but no, taxpayers are paying for years of gross incompetence and corruption by the Council instead.
Jason Perry is absolutely right . All those involved from the top downwards must be held to account in Court and with their appropriate Governing Bodies ;who need to be seen to act. “Deeds not words” to paraphrase the Suffragettes All those accountable in any way at all, must answer in Court under good cross examination. All steps must be taken to do so, forthwith.Justice delayed is justice denied .There are numerous remedies to enforce Judgments . To quote Martin Luther King ” where there is injustice anywhere it is a threat to Justice everywhere”. Why should the residents pay for the incompetence etc of the council’s officers? Enough is enough of the ineptitude of Croydon council.
Is it true that Jason Perry was involved in appointing Jo Negrini and approved her budgets during her time in office?
Perry is like the ‘helpful’ guy being interviewed by the television reporters at the scene of the crime who will later be arrested for the murder.
And can anyone tell me why Kerswell is currently untouchable?
Who was on the committee that agreed Negreedy’s payoff?
Kerswell had the Penn Report under her arse, like some huge brooding hen, for far too long. Who is this controlling narcissist who contributes one part of fuck-all to our borough? Why are we always beholden to these incompetent characters? It’s almost like a domestic abuse situation when the victim finds themselves in a spiralling abusive relationship.
Kerswell – get off your arse and out of our borough.
Trying to get Jo Negrini’s redundancy money back now is surely unrealistic.
It was all signed off by people authorised to do so. In which case she has nothing to fear.
There must be a bit of paper on file in the HR department filing cabinet, setting out the offer, and another one, signed by herself, accepting it. Every council officer being offered redundancy would have one of each-the original and their signed copy.
If there isn’t, the people who should be answering should be the then Director of HR and Finance.
However generous or excessive, if the offer was made by the employer, and accepted by the employee, there is a legal contract in place. It’s basic legal stuff.
Getting any of the money back now will probably be chucking good money after bad.
It could be like spending out a tenner, in a vain attempt to save a fiver.
In local authorities, it seems that when the organisation wants to encourage a senior person to go, it takes a lot of inducement. In a sense, this is right, as no-one should be removed unless they have been corrupt, or reckless, or useless.
Conservatives like Pickles, and Tony Blair’s Labour, are to blame for getting rid of the bodies which applied external controls. Audit Commission, District Auditor. Maybe more. With their dissolution, things went wrong.
Councils self- applying the Nolan principles just hasn’t happened.