CROYDON IN CRISIS: ‘This is not something we will be able to fix alone,’ the borough’s Mayor conceded in a recent letter to the Tory government – who haven’t bothered replying to his request.
By our Town Hall correspondent, KEN LEE
Jason Perry, Croydon’s £82,000 per year elected Mayor, has the catchphrase, “LIstening to Croydon”.
Trouble is, as Perry was forced to admit in public this week, no one in government is listening to him.
Perry has asked the government again for more financial help to write-off a chunk of the borough’s “unsustainable” and “toxic” £1.6billion debt.
Half of that borrowing was built up the last time Perry and the Tories had control of Croydon Town Hall, before Labour’s Tony Newman and his numpties managed to double the debt between 2014 and 2020.
It means that around one-quarter of Croydon Council’s annual budget, close to £50million, is now being spent just to pay off debt repayments and interest, instead of being used to provide the essential services residents expect.
Most of the borrowing came from central government, and the Public Works Loans Board.
But no local authority has ever before been allowed to default on its debt.
That might all be about to change.
Croydon is now at the front of a rapidly lengthening queue of heavily indebted boroughs.
These include Thurrock (Tory-controlled; £1.5billion) and Slough (Labour; £1billion), and were joined earlier this week by Woking in Surrey which, after 22 years under Conservative control to 2022, has amassed £2billion of debt and has now joined that once exclusive Section 114 club.
Only Croydon, though, under Piss-poor Perry, has agreed to hike its Council Tax by 15per cent.
Perry became Croydon’s first-ever elected Mayor in May 2022 after a campaign in which he promised to “fix the finances”. Under negotiations with Whitehall officials that have been proceeding for most of the past 12 months, Croydon has been handed another £224million in government loans (Part-time Perry has failed to mention whether his loans are “toxic” or not).
But Perry says he’s had no word from his Conservative Party colleagues in government whether they will deliver the £540million debt write-off the Croydon Mayor says is necessary.
At this week’s council scrutiny meeting, Labour councillor Rowenna Davis, the committee chair, reminded the Mayor that, as a consequence of government intervention announced in March, he is now Powerless Perry.
“The mayor is still in charge of the council, but if the council is found to be breaching its best value duty for the public the panel has the power to step in and change any decision they are concerned about,” Davis, who has worked as a teacher, schooled the Mayor.
It means that the improvement panel, appointed by the government in the immediate aftermath of the council first going bust in November 2020, can now step in and veto any decisions that Mayor Perry and his Conservative council cabinet might agree.
Perry at least knows that Tony McArdle, the chair of the improvement panel, agrees with him and the council’s director of finance, Jane West, that the “nuclear option” of debt write-off is now the only way out of the very deep hole that Croydon is in.
“We have made it very clear to government that there needs to be a resolution this year before we end up going into another budget cycle,” Perry said, adding the weasel word at the end of his sentence, “ideally”. The government has left Perry waiting on an answer since he issued a S114 notice of his own last November.
Pitching for this week’s No Shit Sherlock Award, Perry added, “I think we have to remember that this hasn’t been asked of government before.”
Perry said that he is in some kind of “ongoing regular conversation with government”, although he admits to being none the wiser about whether a deal will be agreed. “I can’t give you a firm guideline on timings,” he said.
This week’s announcement from Woking probably won’t have accelerated the process for Croydon: Michael Gove and his local government minister at the Department of Levelling Up, Lee Rowley, could calculate now that they might leave a festering turd on their desks, ready to be picked up by whoever is unfortunate enough to succeed them in Sir Keith’s Blue Labour government after the General Election…
It certainly appears that Rowley is now cocking a deaf ‘un to all his Tory mate’s pleadings.
Perry wrote to Rowley on April 26. This week, the emasculated Mayor was forced to admit to the councillors on the scrutiny committee that, six weeks later, Rowley had failed to respond to his (modest) request for a meeting once every six months.
In the letter to Rowley, Perry said that to return Croydon to “a sustainable financial footing” cannot be achieved “without long-term support from government to reduce our toxic debt burden”.
Perry wrote, “Whilst I am committed to taking the tough decisions necessary to reduce costs and improve efficiency in the council…”, meaning ever more Tory cuts, “…this alone cannot meet the scale of challenge presented by our historic debt level.”
And then, Perry admitted, “This is not something we will be able to fix alone.”
Read more: From part-time to powerless: Perry’s first year under scrutiny
Read more: Perry admits he can’t take action against council’s bankrupters
Read more: Councillors agree to chase Negrini for golden handshake cash
Read more: Cover-ups and denial over Brick by Brick failure
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