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Council Tax UP- Borrowing UP
- Council debts UP
An official report ahead of a Town Hall meeting tomorrow night paints a grim picture. And the government Commissioners are unimpressed.
By WALTER CRONXITE, Political Editor
Croydon’s financial position “remains extremely fragile and leaves the council vulnerable to any future financial shocks”.
That’s the uncompromising view of government-appointed Commissioners in their first public pronouncement since they arrived in Croydon in July on the state of the cash-strapped council’s finances.
Failed Mayor: Jason Perry won’t be toasting the Commissioners’ first public report on the council
The Commissioners’ report is buried in a pile of finance paperwork going to tomorrow night’s council cabinet meeting, in which they are scathing about failed Mayor Jason Perry’s “transformation” plan.
“It’s pretty damning,” according to one Town Hall source.
“If Kerswell hadn’t already gone, this report would have forced her to leave.”
Katherine Kerswell resigned last month after five years as the council’s chief executive, a period that included three Section 114 notices, but was rewarded with a £50,000 “golden goodbye” authorised by Mayor Perry so she would not have to work out her notice period.
It’s not all bad news in the council cabinet papers. The council’s bean-counters now think that they won’t need all of the £136million capitalisation direction – bailout – from government that was granted for 2025-2026. Piss-poor Perry’s Croydon has managed to get the required “exceptional” financial support down to a mere…
£126million
“The financial position has improved, but it is still a long road to financial sustainability,” the Commissioners say in their public report, damning with faint praise.
First remarks: the government-appointed Commissioners are forthright in their early findings in the council report ahead of tomorrow night’s Town Hall meeting
The transformation plan, including more job cuts and millions of pounds more spent on consultants and IT gimmicks and gizmos, on which Mayor Perry has staked so much, gets special treatment from Ged Curran and his team of Commissioners.
“The savings contained in Croydon’s budget to reduce its operating deficit are almost wholly dependent on the delivery of a corporate transformation programme,” the Commissioners say.
“This programme has been subject to a delay of approximately nine months, is currently lacking a delivery plan and has not been subject to a prioritisation process whilst also ensuring that sufficient resources are in place to support its delivery,” they say.
“There is, therefore, significant risk attached to the delivery of the savings included in the budget forecast.”
The Commissioners appear deeply unimpressed. They say “this position is also complicated and confused”. Perry and Kerswell’s transformation plan “… is a function of a very centralised approach to budget setting and it is the Commissioners’ view that service efficiencies have not been maximised.”
Borrowing more: this is the ‘plan’ in this week’s council finance report, including another £450million EFS – exceptional financial support, or bail-outs – through to 2030
And at para 7.12 of the Commissioners’ report on Perry’s MTFS – the Medium Term Financial Strategy, which runs through to 2030 – they say, “Commissioners have concerns that accountability at a corporate director level to ensure the delivery of savings according to plan is not completely in place due to the centralised approach.” That’s another dig at Kerswell.
They seek “personal accountability across the organisation”. The Commissioners say that they “remain concerned that the council will struggle to fully deliver the planned savings proposals not least because the council still lacks the corporate capacity and capability and basic working practices to support such a large programme of work.
“The savings also carry a high delivery risk as many savings are either complex or require significant investment to deliver.” This was Kerswell’s idea to spend millions more on bots and AI to reduce levels of human interaction between the council and the public it is supposed to serve.
Our Croydon, Your money: £84,000 per year Mayor Jason Perry has spent more than £100,000 of public money on three editions of his election campaign newspaper
And in bold type and underlined, they write: “Commissioners again remind budget-holders that delegation to spend outside approved budgets does not exist and requires specific authority.”
There is some good news, although this emanates from the government’s new fair funding formula, which is to provide Croydon with £17million in extra funding next year (2026-2027), £34million the year after that and £51million each year thereafter. This additional money will also have an impact in reducing the amount of exceptional financial support Croydon will need from government.
Other medium-term assumptions are also included in the report to the cabinet, such as Council Tax to increase by the maximum allowed – 4.99% – in April and every year following. After having hiked Council Tax by 15% in 2023, it means that Council Tax in Croydon will have increased by 33% under Tory Mayor Perry.
And the council that is burdened by £1.4billion in debt is going to be borrowing even more – almost another half-a-billion more by 2030.
“I
t is assumed that further capitalisation directions will be required of £126million in 2026-2027, £114million in 2027-2028, £102million in 2028-2029 and £108million in 2029-2030 to reflect the currently illustrated budget deficits,” the council’s own report admits.
The report admits that its projections “continues to show a financially unsustainable position for the council over the medium term”.
The council’s finance director, Jane West, writes, “The council recognises that, as well as working collaboratively with government (through its appointed Commissioners) to develop a package of measures for the affordable and sustainable treatment of debt, the council must also continue to deliver further savings, including through the transformation programme, whilst maintaining appropriate quality standards within services to meet its statutory duties.”
As well as budgeting for inflation and wage settlements with what remains of the council’s staff, and the rising costs of temporary housing provision, adult social care and children’s services, West’s report deals with the cost of managing the council’s borrowing.
Debt repayments and interest on loans was supposed to cost Croydon £70million this year. Next year, that’s forecast to rise to £85million. “The debt servicing cost is forecast to be circa 16% of the 2026-2027 net budget requirement,” the report states.
And in 2022, Jason Perry was elected Mayor after a campaign in which he promised to “fix the finances”.
Read more: Auditors issue Perry with warning over ‘unsustainable’ finances
Read more: The Kerswell Affair: Croydon is worse off after CEO’s five years
Read more: When’s a pay-off not a pay-off? When it’s 50 grand in Croydon
Read more: #BINMAGEDDON: Perry sneaks out charges for wheelie bins
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The two main Political parties have failed the people of Croydon and the people are seen as cash cows for Council Tax increases at a record level, Social Housing ( Council Housing) Rent and Service Charges also ( in excess of an 18% increase and that includes the optional 1% on top of the appropriate CPI increase. Yet we do not get satisfactory services why? Total mismanagement of Croydon Finances. Will we get the same after the elections next year?
When you make comments on our material on Faustbook, Les, can you remember to copy them onto the articles here, too, please. Quite certain you made a couple of important points on FB that you have not covered here, and which our loyal readers would appreciate being informed about.
What news is there here. What are the commisioners costing taxpayers when if you asked any of the hardworking officers they could have described current status at no cost.
We mustn’t forget though that Labour also got Croydon into this mess in the first place so be careful who you vote for.
The news here is that this is the latest official update of the council’s financial position, and the first public statement from the Commissioners.
And Inside Croydon has been reporting on the council’s deteriorating finances for the past 15 years, at nil cost to the borough’s residents, although you can opt to take out a monthly subscription via our Patreon page.
The cost of the commissioners (and the previous improvement panel) is public information and has been reported several times on IC.
The councils finances are also public. The issue isn’t their status – everyone knows they are bad – but the lack of action by the Mayor and his appointed cabinet to do anything about them.
There are many who work at the council that are hardworking in the roles they do. But they are not allowed to speak openly and many have contracts forbidding what you suggest. The politicos are always describing what their view is on many social media apps and with poor accuracy little fact and a lot of non information. If there are avenues to have data simply other than laborious FOI requests please do let me know – best wishes
Commissioners are obviously unimpressed by Kerswell’s efforts, or those of the Mayor, however anyone in Croydon could have told them that neither was competent, despite charging us all far too much for their activities. Anyone have an account on Linkedin? I’d love to read Kerswell’s CV.
Mayor Perry laughing all the way to bank and
he’s seems don’t careless for citizens of Croydon
day to day basis BROADGREEN AREA of Croydon
Getting dumpster yard for fly tipping and vehicles