CROYDON IN CRISIS: Town Hall bosses have been forced to accept 23 recommendations from external accountants after IT problems saw them lose track of thousands of payments, in the latest council cock-up that was described by a veteran Tory councillor as ‘quite frightening’.
EXCLUSIVE by STEVEN DOWNES
Croydon’s failed Mayor suppressed discussion of a £12million “IT error” ahead of last month’s budget-setting council meeting.
A veteran Conservative councillor this week described the multi-million-pound “mis-statement” in the council’s draft accounts as “quite frightening”.
Having a ‘mare: failed property deals, High Court rulings and £12m ‘lost’ from the SEND budget have piled up problems for failed Mayor Jason Perry
This latest financial omnishambles comes soon after Tory Mayor Jason Perry needed a £119million government bail-out to balance his council budget while claiming he has Croydon’s finances “back on track”.
It is more like Ground Hog Day at Croydon Town Hall, with outside experts called in to try to unravel the latest mess of the council’s own making, much like the dark days of 2020 after Croydon issued its first Section 114 notice of effective bankruptcy.
Prior to Perry’s budget meeting in the Town Hall Chamber at the end of February, opposition councillors were blocked from asking about the massive overspend on SEND children – those with special educational needs and disabilities.
Belatedly, senior staff have admitted that the cash-strapped council bust its SEND budget in 2024-2025 by at least £12million. But it wasn’t until this Thursday – three weeks after the Tory Mayor’s budget was voted through – that a specialist report into the multi-million-pound disparity finally got to be discussed publicly at the Town Hall.
Croydon Council has now accepted 23 recommendations in a report from CIPFA, the Chartered Institute of Public Finance and Accountancy. The CIPFA report was briefly discussed at Thursday’s audit and governance committee meeting, where just three councillors were allowed to ask questions of council directors about the latest failure of management. The discussion of the £12million overspend that lasted less than 40 minutes.
Perry, who is paid £86,000 per year as Croydon Mayor, did not attend the audit and governance committee meeting.
Jason Cummings, the cabinet member in charge of finances at the Conservative-controlled council, was present. But Cummings did not speak about this massive accounting failure.
All present at the Town Hall meeting seemed to agree that the problem has arisen because the IT system used for managing the education department’s spending does not match the council’s overall accounting IT system, Oracle.
That has meant that, after years of redundancies and cut-backs, the already stretched council staff have had to transfer information from the education database to Oracle manually.
No one brought themselves to comment on the irony that the education accounting system is called… Synergy.
According to figures presented at the meeting, Croydon has around 6,300 SEND children who have EHCP – Education and Health Care Plans – which the council has a legal duty to provide. The council’s caseworkers are each being expected to manage 2,500 cases – children – the meeting was told.
The council’s staff cannot cope. “Our team capacity is unable to meet that demand at the moment,” one senior council official said.
It is suggested that Croydon has the highest number of EHCPs in London. Between 600 and 700 of those children receive their education at schools in the independent sector outside the borough, and it has been here that the rapidly increasing spending has over-run the education department’s budgets.
CIPFA’s expert accountants were called in to Croydon at the end of 2025. Their immediate assessment is that the Synergy payments system needs to be replaced. But the council can’t afford to do that.
“Current gaps in systems, processes, governance and data quality undermine confidence in financial and operational information,” they state at the start of their report.
Education director: Shelley Davies appeared via videolink at the meeting
Among their 23 findings and recommendations was: “The council lacks a single, reliable, real-time view of SEND expenditure.” Oh.
“The Synergy system… requires improvement.” Oh.
CIPFA blames the council’s IT department for this. “A number of areas of concern were identified regarding the operation of the Synergy system…”. Oh dear.
“Improvement plan progress is slow due to lack of capacity.” In other words, there’s not enough staff left to provide a quick fix.
And it is not just Oracle and Synergy that don’t, in techspeak, “talk to each other”. CIPFA’s report says, “End-to-end processes are not clearly understood, especially between SEND coordinators and finance.” Oh.
CIPFA recommends “consider production of SEND officer handbook…”, suggesting that there is not one at present.
Then there’s: “There is no consistent approach to quality assurance across the SEND lifecycle.” Oh. And: “Day-to-day management consistency varies, and standard operating procedures are lacking.” Oh.
“Priority short-term actions are needed to improve forecasting and budget accuracy.” Really? You surprise us.
It gets worse.
“Significant effort is being wasted attempting to make the Oracle purchase order process work for SEND.” And: “Payment practices lack consistency, including when providers are paid and how risk is assessed.”
Or: “Payments to schools are inconsistent and prone to error.”
CIPFA’s report is reminiscent of some of the external reports generated in 2020, before and after the dysfunctional council’s finances hit the rocks, with a Report In The Public Interest from auditors Grant Thornton that described Croydon as suffering from a “collective corporate blindness”.
Has much really changed, as Perry and Katherine Kerswell, his former chief exec, were so fond of claiming?
Some of the CIPFA recommendations in their report amount to statements of the bleedin’ obvious. Such as: “New staff require on-the-job training that depends on in-office presence.” No shit, Sherlocks!
But ally that to this finding: “Current management structure does not allow for sufficient oversight or control”, and you have the perfect mix for a potential shitshow.
CIPFA say that, “There is no single narrative or detailed analysis explaining the 2024-2025 overspend.” Which kind of contradicts the lines offered at Thursday’s meeting by two senior council directors, who were keen to shift th narrative away from their own failings, and to highlight how rising SEND demand is a national problem, not just Croydon’s..
No cover-up: Conrad Hall ignored how the CIPFA report had been withheld before the council budget meeting
Shelley Davies is a former primary school teacher who has worked at Croydon Council for 23 years. She has been director of education since February 2019. Only now, she said on Thursday, has she got staff in her department going through the accounts line by line.
Conrad Hall has only been Croydon’s head of finance for a couple of months. He was appointed on the recommendation of the government’s Commissioners, so ought to have had a good idea of what to expect.
“No organisation gets things right all the time,” he said. No one was allowed to ask why Croydon Council manages to get things so horribly wrong so often.
Ian Parker, one of three Conservative councillors to attend the committee meeting, but the only one of them to ask any questions about “the lessons to be learned”, described the massive mis-statement in the draft accounts as “quite frightening”.
Hall did his best to put a positive spin on things. Mentioning the (somewhat limited) discussion in public and the delayed publication of CIPFA’s report, Hall said: “I have worked for some councils that would not have wanted to conduct a review in this way.” So no cover-up, then?
Truth is, Hall still works for a council that did not want to conduct a review of this £12million hole in its budgets.
Amy Foster, Labour’s shadow cabinet lead on educaation matters, says she was shut down at February’s pre-budget cabinet meeting, when she wanted to ask why CIPFA accountants were actively double-checking the council’s own figures.
Shocked: Cllr Amy Foster
“To shut down a councillor’s question about how £12million had been added to the accounts pretty much overnight was shocking,” Foster told Inside Croydon.
“Such public defensiveness could all too readily be interpreted as a sign that all is not well within the council’s SEND department.”
Foster suggests that the delay in publishing the CIPFA report was “a deliberate effort to reduce visibility on an issue that could be potentially embarrassing to the council”.
She said: “This blows to pieces the Mayor’s supposed commitment to financial transparency and the idea that he has managed to ‘fix the finances’ or got the council ‘back on track’.”
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So it has taken seven years in the job for the Director of Education to ensure that her staff monitor their expenditure (line by line) – amazing. The key tasks of “management” is to manage the M’s. That is Men (and women), Materials, Money and Machines. There seems to be a failure here of staff, money and machines (computers). Where was the Leadership in all this?
Indeed but i fear it is being minimised as a systems failure. Costs can be managed down by proactive supply of local services instead of expensive out bourough placements but as you imply basic fit for purpose organisation is lacking from officers and councillor governance has failed.
A £12m overspend plus c£5m in LTN fine refunds plus c£2.5m a year in lost LTN fine “income” isn’t “fixing the finances” or balancing the budget. It’s Perry desperately papering over the cracks.
When a previous Croydon Conservatives leader, Mike Fisher, was caught with his hands in the till in #WadGate, his former supporters ganged up and pushed him out.
The current leader has awarded himself multiple pay rises and takes a full-time salary for doing hardly any work. What little he does, Perry does badly, and yet he enjoys the full support of his Cabinet and backbench councillors; our Council Tax lining their pockets with allowances buys their loyalty.
Piss-poor knows he’s in the last chance saloon and doesn’t really care; if he loses the Mayoral election in 53 days’ time, unlike in 2022, he’s not simultaneously standing as a councillor. Time for a new Tory leader?
I’m sure Porky has made sure he’s going to be alright, in the likely event that he is kicked out in May!