The government-appointed improvement panel recommended intervention by Commissioners after the cash-strapped council laid out ‘impossible’ plans for additional borrowing
The “runaway position of the council’s finances” and a plan for continued bail-outs from central government had created “an impossible position”, according to a report on the management of Croydon’s finances which has been released today.
The government’s decision to send in Commissioners to take over the running of Croydon Council was made after the report from their “improvement and assurance” panel.
The panel, which was parachuted into Croydon’s crisis-hit council in early 2021, has spent the past 18 months or so planning its “exit strategy”, intending to leave a more stabilised council than the one they first encountered more than four years ago. Yet this latest report also amounts to a 19-page admission of their own failure by panel chair Tony McArdle and his well-paid team of “experts”.
The massive overspend in the last financial year and council officials’ plans to borrow their way out of trouble over the next four years would, according to the improvement panel’s report, lead to Croydon Council’s complete “collapse”.
In McArdle’s report to Whitehall, he says: “We wrote to the council following the government’s confirmation of the substantially increased EFS [Exceptional Financial Support] of £136million for 2025-2026.
“Our letter was clear in that EFS was only intended to be a short-term measure and an MTFS [Medium-Term Financial plan] which, as the council’s does, assumed EFS for each of its four years was an impossible position. If it was not addressed, the council would face collapse.”
Doom-laden: after almost five years, the improvement panel’s report is much more critical of the council’s efforts
Under the Tory-led council’s finance plans, our Town Hall’s debt would reach £2.2billion by the end of 2027.
Thus McArdle’s improvement panel’s recommendation, in their report to Deputy Prime Minister Angela Rayner, says that she should “consider continuing a form of statutory intervention beyond July 2025 and increasing the focus upon where challenges are most acute in order to provide the council with sufficient support to deliver the Stabilisation Plan – and its inevitable successor, a Recovery Plan – in order to ensure its movement towards compliance with the Best Value Duty.”
There’s more than a sense of a Croydon version of Groundhog Day about the whole thing.
McArdle’s report had been intended to be his final update to the Secretary of State over the cash-strapped council. But it includes plenty of buck-passing over the improvement panel’s own abject failure to achieve anything resembling improvement.
Since 2023, the panel has had additional, statutory powers over Croydon’s bankrupt council, though the financial position at the authority has only got worse, to the point where local government minister Jim McMahon today described it as a “crisis”.
In their review of their four years overseeing the work of the council’s executives, McArdle more than once refers to how “the pace of change remained slow”. With the panel’s chair and its members being paid between £900 and £1,000 for every day they spent at Fisher’s Folly, it seems odd that they were never able to exert any influence to speed up that pace of change.
McArdle and his team suggest that matters have become much worse at Croydon over the past two years – coinciding with Jason Perry being in place as the borough’s first executive Mayor.
At one point in their report, they use simple facts to provide a stark reminder of how “Fix the Finances” Perry has only managed to do the exact opposite: “The value of capital directions, both confirmed and in principle, for the period 2019-2020 to 2025-2026 amount to £533million.” It is worth noting that this is more than half the borough’s current total debt of £1.4billion.
Praise for staff: Tony McArdle’s latest report is an admission of the improvement panel’s own failure
“In addition, for 2023-2024, the council was granted the ability to increase Council Tax from 4.99% to 14.99% without the need for a referendum.” That, of course, was done at the explicit request of Mayor Perry.
“A great deal of effort has been put into becoming a properly functioning local authority, with a good deal of success,” McArdle’s report says.
“This reflects creditably on the staff of the authority, all of whom have had to work hard to make this happen…
“The challenge for Croydon has always been – and indeed remains – that it must travel further and faster to regain the absolute minimum position of meeting its duty of Best Value, let alone to be able to compare itself with neighbours thereafter.”
McArdle has, in the past, echoed pleas from Croydon’s Jane West, the council finance director, and others that a debt write-off is the only realistic solution to the financial death spiral that the council finds itself in.
He certainly does not believe that Mayor Perry’s latest budget, passed in February, is a balanced one.
“Notwithstanding the progress made,” McArdle says, “the council is unable to meet its Best Value Duty as it continues to present an unbalanced financial position. The substantial projected overspend in 2024-2025 together with an MTFS [Medium-Term Financial PLan] that increasingly relies on EFS [Exceptional Financial Support], makes it inescapable that the council will remain financially unsustainable for the foreseeable future.”
Despite having delivered at least two update reports per year to the Secretary of State since 2021, it is only in his April 2025 report that McArdle has expressed such outright criticism of the way the council was being run (all while under his and his panel’s supervision).
At one point, McArdle bleats about his panel’s “absence of any formal powers”, and reveals that his team was having to provide the council with “advice notes” on a weekly basis.
“The council had focussed [sic] its improvements on responding to statutory recommendations or those resulting from external reviews… an approach which, while necessary, was largely reactive in nature.”
Odd that he should only notice that now.
Read more: McMahon acts after serious concerns on ‘aspects of leadership’
Read more: Government sends in Commissioners to run Croydon Council
Read more: Government grants Perry’s record £136m council bail-out plea
Read more: Kerswell’s ‘Stabilisation Plan’ has failed before it is approved
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What are we the people of Croydon, who have had no choice in this matter, other than having had to keep paying greedy conservative and labour councillors, able to do?
Out of pure desperation we will probably vote Reform. Lol
You are joking. The party that caused the Brexit financial meltdown?
They would make things even worse.
Reform UK won 677 of around 1,600 seats in local elections on May 1.
According to Hope Not Hate, at least nine of those have already had to resign (including two because they were disqualified from standing as local councillors while employed by the council), or have been suspended or expelled by their own party.
“All contain a whiff of the incompetence and strife that has dogged the party throughout its history,” Hope Not Hate says of the limited company masquerading as a political party.
Farage is a grifter. Always was. Always will be.
And we’re all suffering the impact of Brexit because of it.
We?
how much did the improvement panel charge for its expertise or its failure for the expertise they offered to help at a cost? i assume it was not kindness.
Read the article. It tells you in there.
How many people are in the optimistically and erroneously-named Improvement Panel?
£900-£1,000 per person per day is stated in your article, though how many days they attended is also unstated.
What was Chair Tony McArdle’s previous job / background?
My apologies if this is in a previous posting that I have not seen.
Six. Not all are on the same pay scale.
Most have some background in local government. McArdle has been on the inspector bandwagon, with one of his co-panellists, for almost a decade. They oversaw Northamptonshire County Council’s S114 descent (the first this century). They dissected it into two authorities, both of which have gone bust.
With most of these questions, a simple search of the iC archive will yield answers.
In 2023, a FoI inquiry showed that after three years, the people of Croydon had already spent £600,000 for the benefit of having an “improvement” panel.
https://insidecroydon.com/2024/04/19/603000-the-soaring-costs-of-croydons-improvement-panel/amp/
Another two years on, that cost must now exceed £1million.
Money well spent? They didn’t even stop Perry wasting our money on his Our Croydon propaganda sheet.
Thanks for that and for your extra worrying details.
I will look out for your archive search too.
Any respectable old school politician would resign with such an appalling assessment of their period in office. Fat chance with this chancer Perry. He will be milking his office for as much as it is worth like Kursewell Reid.
It does look like a debt write off of the money squandered on Brick by Brick and the hotel purchase is the only way to get the finances in order. Have any lessons been learnt?
Perry is worse than Newman.
The council borrowed £200million for Brick by Brick. They did manage to build some homes.
Perry has borrowed a similar amount. And put Council Tax up by 27%. For what?