Levelling up secretary Michael Gove has announced a statutory intervention package for the London Borough of Croydon.
The Improvement and Assurance Panel appointed to guide the authority’s financial improvement has been placed on a statutory footing, meaning it is now empowered to instruct rather than guide Croydon’s improvement activities, should the panel deem it to be necessary.
Gove has also appointed Brian Roberts and Pamela Leonce to the panel to respectively lead on the individual priority areas of finance and housing.
Roberts provided financial support to the commissioner team in Liverpool and was finance commissioner at Northamptonshire County Council. He is currently chair of the CIPFA Financial Management and Governance Panel.
Leonce is the CEO founder at Stowhill Careers and has been an executive director with experience across the housing, health, social care and criminal justice sector.
The panel is chaired by Tony McArdle. Previous finance lead Margaret Lee tendered her resignation on 12 March for “personal reasons”.
Jon Wilson and Phil Brookes will continue in their respective roles as leads in adult social care and commercial and asset disposal. A new panel member for transformation will be appointed in due course.
The statutory panel has been appointed until 20 July 2025, or until such earlier or later time as determined by central government.
“The panel will be asked to provide their next report within the next three months, with their initial views and an assessment of whether they require further support,” said Gove in a statement to the House of Commons. “I will review panel membership at this point to ensure that the panel continues to be fit for purpose for the council. Future reports will be provided every six months, or as agreed with the panel.
“I want to be clear that the council will continue to lead their recovery but that the intervention package and appointment of the two new panel members will ensure momentum is both maintained and increased with the support and expertise of the panel. That is to say that decisions will continue to be made by the council; the intention being that the panel will only use their powers of instruction as a last resort if they are dissatisfied with the council’s improvement processes.
“The government will continue to work closely with the political, business and cultural leadership of Croydon, to ensure the return of the council to sustainability for the long-term. We wish to place on record our thanks for the progress made to date and look forward to further advancement in the months ahead.”
Council directions
Max Soule, deputy director, local government stewardship at the Department for Levelling Up, Housing and Communities (DLUHC), wrote to Croydon’s chief executive Katherine Kerswell to provide further direction.
“The secretary of state is clear that he expects significant progress to be made over the next three months, building on what has already been achieved, particularly in relation to financial management, housing, and overall transformation and compliance with the best value duty,” he wrote.
The directions require Croydon to take certain actions. These include continuing to implement “the London Borough of Croydon Renewal Plan to the satisfaction of the Improvement and Assurance Panel” and “to continue to address the culture of poor financial management of the authority”.
Croydon must also “continue to improve the capacity and capability of the authority’s housing service”; “continue to restore public trust and confidence in the authority by transforming the authority’s activities, practices, and omissions to ensure that they are compatible with the best value duty”; and “secure as soon as practicable that all the authority’s functions are exercised in conformity with the best value duty thereby delivering improvements in services and outcomes for the people of Croydon”.
Reports on the delivery of the London Borough of Croydon Renewal Plan must be made at six monthly intervals, or at such intervals as the Improvement and Assurance Panel may direct.
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A DLUHC explanatory memorandum gave context to Croydon’s financial troubles.
“The authority is working to resolve serious governance and financial issues, including historic ones, that have occurred over a number of years, with significant support. Historic issues have continued to be unearthed at the authority and their potential impact on the authority and the progress it has made to date cannot be underestimated, particularly given their precarious financial position,” it said.
“The authority is currently unable to achieve financial sustainability of its own accord and has requested an unprecedented level of support from government as a result of these historic issues.
“The authority has been subject to two Public Interest Reports by external auditors relating to poor financial decision making and associated governance failings (October 2020) and failures in financial control and poor governance arrangements relating to the refurbishment of Fairfield Halls (January 2022).
“It has also issued three Section 114 notices since 2020, the latest being in November 2022 following the conclusion that it could not balance its budget in 2023/24 and beyond, following the uncovering of further legacy issues.”
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