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Ex-councillor Hall says: ‘Sorry to be direct, but this is a lie’

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CROYDON IN CRISIS: Only two elected councillors have so far had their roles in the council’s financial collapse questioned, and Tony Newman and Simon Hall are still not saying sorry. EXCLUSIVE by STEVEN DOWNES

Budget balancing act: Simon Hall admits asking officials to look at the number of households paying Council Tax, just not ‘directing’ them to add 5,000

Tony Newman and Simon Hall, two of the leading figures at Croydon Council in the years leading up to its financial collapse, have issued further statements refuting any suggestion of “misconduct” on their part.

Newman, the discredited former leader of the council, and Hall, his cabinet member for finance, both resigned in October 2020, just days before the highly critical Report In The Public Interest was released by auditors Grant Thornton. They then both quit as councillors in early 2021, soon after Richard Penn had concluded his many interviews and the drafting of his report, which included in his recommendations consideration of whether the duo had broken the council’s code of conduct.

Newman and Hall had their membership of the Labour Party suspended soon after, a status which remains unchanged more than two years later.

Newman and Hall have resurfaced after months of silence, following yesterday’s council disciplinary committee meeting, where it was agreed, finally, to act on the recommendations of the Penn Report.

Chris Philp, the Conservative MP for Croydon South, has also called for the Metropolitan Police to investigate Hall for misconduct in public office, over allegations contained in the Penn Report that he ordered council staff to inflate the number of households in the borough for Council Tax calculations, to help balance the Town Hall budget planning.

Juggling act: budget figures could be manipulated if Council Tax bands are adjusted or numbers increased

Hall’s response was to share with Inside Croydon his written answer to a direct question put to him in December 2020 by investigator Richard Penn when researching his report.

Penn asked Hall: “I have been told that you instructed that 5,000 additional properties should be placed in Band D for Council Tax income calculation purposes. This would significantly increase the predicted income from Council Tax which would in turn assist with budget setting decisions. Is that correct?”

Hall’s reply was: “Sorry to be direct, but this is a lie.” In the version seen by Inside Croydon, the word “lie” is in bold type.

“First of all, I never had the power to instruct officers in this sort of way.” Which is true, and is pretty much the point at issue.

“Secondly, the Section 151 officer had to be satisfied about the reasonableness of all assumptions in the budget. We often had discussions about the assumptions, but came to an agreed position. Lisa commented on this on numerous occasions.” “Lisa” is Lisa Taylor, who became the council’s most qualified senior finance official after the resignation of her boss, Richard Simpson, in November 2018.

What follows appears to contradict Hall’s denial.

Hall wrote to Penn: “We did have a discussion about the budget assumptions in respect of the Council Tax base.

“To put this in context, as a council, we had, year-on-year, taken a very cautious approach to Council Tax base growth and ended up with a large collection fund surplus. When I saw the draft budget assumption (very early on in the process), I said that this looked very low given the year-on-year track record and the amount of construction activity going on in the borough.

“I did say that I definitely felt that this needed to be looked at again. The relevant head of service went away, spoke to his counterpart in planning, and the figure was revised upwards (I cannot find documents to say by how many the assumption was increased).

“However, I did not give a specific number nor instruct. I have not been made aware of any adverse variance in Council Tax Base, as against the budget assumption.”

Hmmm…

Since their resignations as councillors in March 2021, Hall and Newman have been issuing their statements via a Covent Garden-based PR agency, crisis management “specialists” Palatine, founded by Conal Walsh, a former business investigations editor at the Grauniad.

 

It appears that the “agreed line” being taken is not that Newman and Hall have done no wrong, but there is no evidence of wrongdoing.

In a joint statement issued on behalf of the ex-councillors today, it said: “No evidence of misfeasance or misconduct.

“None of the three independent reports commissioned to look into Croydon’s bankruptcy have found any evidence at all of bad faith, dishonesty or malice,” the statement said.

Hello, hello, hello: might Tony Newman be getting his collar felt?

“Everyone who served as a councillor truly regrets Croydon’s financial crisis, and the constraints it continues to put on public services and families in the borough. But things can go wrong without there being any wrongdoing. All of our decisions were taken in good faith, on advice, and in the interests of the people of Croydon,” the Newman and Hall statement read.

They continued with familiar excuses.

“It would be wrong to attribute Croydon’s problems just to spending decisions…”.

“Croydon has also faced unique challenges…”.

“Croydon was also an epicentre for the UK’s covid outbreak…”.

This, we are told by Newman and Hall, “put enormous unanticipated strain on our care services and was the trigger for the borough’s final crisis…”.

Note that: “unanticipated strain”. Newman and especially Hall had received warnings from the council’s auditors for three successive years before 2020 about the dangerously reduced level of council reserves.

According to Newman and Hall, “Croydon was forced to issue a Section 114 notice because of a single ‘black swan’ event – namely the covid shutdown, which choked the council of revenue while adding enormously to its costs.” It’s almost as if the only local authority affected by covid in 2020 was Croydon.

 

“It was a perfect storm, and we were unable to weather it because of years of underfunding and austerity which left us with very limited financial room for manoeuvre.” Especially after ignoring those three auditor warnings over reserves, as well as borrowing north of £600million, and lending £200million of that to Brick by Brick.

And then there’s: “Even with hindsight some of the criticism of Fairfield Halls is misplaced…”.

And this: “It is of course regrettable that Fairfield Halls ran over budget, but it is hardly the first public project to do so.” So that’s all right then.

Oh, and because they resigned two years ago, Newman and Hall think they should no longer be subject to any scrutiny for their past actions. “Instead of doing their jobs, getting a grip and serving the people of Croydon, the council is wasting yet more time and resources trying to scapegoat people who have not been in office for several years.”

So that’s it. They are just scapegoats, and had no responsibility whatsoever for the extraordinary and catastrophic mishandling of the council’s finances during the years they were in charge.

Still no apology. Still no remorse.

Read more: MP calls for misconduct charges against ex-councillor Hall
Read more: The Audit Report: ‘Tony Newman always has been a coward’
Read more: Penn Report wanted police probe into possible misconduct
Read more: Cover-ups and denial over Brick by Brick failure


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