Labour politicians have been accused of a ‘culture of bullying’ and that the administration ‘played Monopoly’ with the borough’s money.
During a heated exchange at last night’s extraordinary council meeting Labour leader Cllr Hamida Ali was asked why she hadn’t removed the whip from councillors Tony Newman, Alison Butler and Simon Hall (pictured left)?
Opposition leader Cllr Jason Perry said she should demand they resign and that residents were ‘so angry’ at what has happened to ‘our town’. He said: “How can they be allowed to sit as councillors for another 18 months?”
An independent investigation in to who was responsible for the risky property speculation and how they were able to get away with it has been launched by the cross party London Government Association. It could also result in formal disciplinary action against councillors and senior council executives.
Cllr Perry also accused the current leadership of being complicit in the decision making process which had resulted in the council going bust.
At least two Labour councillors tried to shift the blame on to officers for providing poor information on Brick by Brick and the failed Croydon Park Hotel investment.
Listening in to the meeting were representatives from the Ministry of Housing and Local Government who are being asked to bail out Croydon to the tune of £66million.
Most damning was the comments of shadow spokesman for finance Jason Cummings (pictured bottom left) who said he raised several times concerns which were subsequently published in Grant Thornton’s public interest report only to be told by the former leader Tony Newman that he was ‘immature, ill informed’ and ‘scare mongering’.
He said this was typical of the ‘bullying attitude’ of Newman’s leadership. He said this was all raised in front of the new leader and deputy Cllr Hamida Ali and Cllr Stuart King who did ‘nothing’ and sat there.
Cllr Ali, said there had been a change and that the people in previous roles were no longer in them. She accepted she was part of the cabinet that made the poor financial choices and took her share of responsibility but reminded the council that the auditors had said it was a ‘corporate challenge’.
Cllr Ali (pictured middle left with Cllr Newman) said when she had first read the report there was, ’shame.’
She said she was ‘deeply sorry’ that the council was in this position and determined to make it right.’
Cllr Ali said councillors had all heard concerns from residents, staff and partner organisations, about the council’s situation but reassured: ’we will continue to be there for them’ and ‘deliver vital services’ and ‘rebuild trust’ of communities and staff.
The accusations came thick and fast from the Conservatives who refused to back Labour’s action plan which was voted through anyway.
The council heard from Sarah Ironmonger and Paul Dossett from Grant Thornton that councillors on both sides had voted unanimously for the 20-21 budget despite them red flagging the council’s spending and financial arrangements dating back to 2017-18.
A contributory factor was major overspends particularly in the provision of services to vulnerable adults, children, and unaccompanied minors this was coupled with reserve levels which were the lowest in London and reducing year on year.
Early in April former CEO Jo Negrini was told vital action was needed in a letter from Grant Thornton marked private and confidential which has never been shared with members.
She set up a financial review panel to tackle the £65million budget gap which while it had made good progress by July in closing the gap, it was ‘frustrating’ said Mrs Ironmonger that when Section 114 was issued in November it had risen to £66 million.
The council was told there had been ‘little evidence’ of challenges from members or financial rigour around money lent to third parties groups such as Brick by Brick. They were told there was a need for clear governance arrangements, scrutiny of public money and an understanding of whether companies were delivering what expected to or not.
The scrutiny oversight was criticised and Mr Dossett said politics had no place’ in the scrutiny process.
Cllr Sean Fitzsimons lead on scrutiny refuted accusations of bullying from Conservatives He defended the decision of his scrutiny committee, criticised by the auditors, not to oppose the purchase of Park Hotel which subsequently went in to administration. It was called in by scrutiny but not referred to full council after a four to one vote. He claims he was ‘too trusting’ off officers advice. He said he wouldn’t resign even though he was . also criticised for not flagging up to the full council in August fears raised before his committee of an impending Section 114.
There was also further criticism of governance of the Brick by Brick arrangement. No loan payments or dividends have been paid by from Brick by Brick. Conservative Cllr Lynne Hail said this was contrary to what councillors were told previously by former cabinet lead for finance Simon Hall. Cllr Hall said he wanted minuted that he was provided with this information by council officers and Brick by Brick. It is unclear whether the council will ever be able to recoup the £30million.
Conservative Cllr Robert Canning described Brick by Brick as ‘little more then a Ponzi scheme’ and asked Deputy leader and Cabinet Member for Croydon Renewal Cllr Stuart King if he agreed?
Cllr King said the governance was ‘inadequate and protocols’ not enforced. He said there was now stronger governance and they were looking at the best way to protect tax payers interests including more than £200 million in loans paid to Brick by Brick.
He said it was likely in the short term that this might involve continuation of funding on current loan agreements, but that going forward decisions were being made on a site by site basis with transfers halted.
Councillors were told there was a need for improvement to the council’s: culture, decision making, risk assessment, communication with officers, members challenges, members strategy and plans.
Current cabinet member for finance Cllr Callton Young said councillors had been ‘found wanting’ and that there was ‘collective responsibility’ for the mess. He recommended councillors sign up for free financial masterclasses provided by the Local Government Association.