As we all know, the Council's budget is in a dire state, but we didn't realise how dire until their auditors Grant Thornton issued a Report In the Public Interest" (RIPI) in late October. These are so rare that until now only four have ever been issued across the whole country since 2014, and none has previously been issued for a London borough. It's available here, if you can bear to read it: https://www.croydon.gov.uk/sites/default/files/articles/downloads/Repor…
The 21 page external report highlights a litany of spectacular failures of management and of governance as well as sheer incompetence, such as the failure by LBC Holdings LLP, which is a wholly owned subsidiary of the Council to submit an annual report to Companies House; this resulted in the company being struck off the register, and its assets being seized by the Government. How is that remotely possible?
And then there's the crass £80M investments in a hotel which went bust and in a struggling shopping arcade; both were funded with borrowed money on which interest still has to be paid, and our total interest and debt repayments now total about £50M per year = roughly £125 per year per resident. Brick by Brick, another wholly owned subsidiary of the Council which has also failed to repay some £30M which was due, but this debt has been hidden from opposition councillors till now.
The reports highlights the fact that LBC has been completely unable to control expenditure to meet its budget, year after year. Covid-19 has obviously been a problem across the whole country, but Croydon is the only borough to fail so spectacularly, to the extent that it is unable to fund about £70M of expenditure in this year alone, despite receiving £millions in grants from HMG.
Things came to a head on 11 November when the Council's Director of Finance issued a S114 notice which banned all non-essential expenditure, and that has had a direct impact on Community Ward Budget expenditure, as you'll see in later blog(s). The S114 report is here:
https://www.croydon.gov.uk/sites/default/files/articles/downloads/Repor…
It makes even grimmer reading than the RIPI, because 10 days on, the Council has realised that some of the earlier figures were wrong, and are even worse than expected due, among other things to double-counting.. how crass is that? There's a full council meeting on Thursday 19 November at 6:30pm which will be webcast, and no doubt a depressing view.
