Croydon Council is not failing despite finances, says mayor
In a video released shortly after the announcement, Perry pushed back against the proposal, stating: "The government should be helping us, not hindering us by heaping more pain on our borough."Tensions came to a head at an "extraordinary council meeting" on Wednesday, brought forward by Labour councillors in response to the looming intervention.While the mayor's defiant stance won some support, many councillors expressed concern that his tone risked damaging the south London council's chances of negotiating a favourable outcome.
Labour opposition leader Stuart King said he understood Perry's frustration, but criticised the combative response."Launching a full-throttle political attack on the government doesn't make it more likely we'll secure the deal we need," he said."Your reaction was ill-considered and has harmed, rather than helped, Croydon's prospects."New figures released this week show the council overspent its budget by £30m last year, requiring £136m in exceptional financial support to stay afloat.The council is also burdened with £1.6bn in legacy debt, costing £70m annually to service. This debt appears to have risen by £0.2bn in the past year.Croydon has been under the government's Improvement and Assurance Panel (IAP) review since it issued a Section 114 bankruptcy notice in 2020.The IAP was intended to provide oversight and challenge, but McMahon's recent report described a "lack of urgency" during the intervention and warned that the council was approaching a fresh financial crisis.The report also called Croydon's ongoing reliance on emergency funding, now totalling £553m since 2021, as unsustainable.While McMahon promised a "short, sharp reset", no specific details have been shared on what powers commissioners might hold or how direct their involvement would be.
Despite his earlier video, the mayor later struck a more conciliatory tone during the sweltering hot council meeting.Speaking to the Local Democracy Reporting Service (LDRS) after the meeting, he said he would be willing to work with commissioners, but added: "If we get to a position where they say council tax needs to go above the cap or that services need to be salami sliced, I will oppose those decisions."While there was broad agreement on the decision to work with future commissioners, opposition councillors were quick to remind the mayor that he had raised council tax to its highest ever level and brought forward cuts to services like libraries and youth engagement under his watch.The Conservative-led council says it has generated over £230m in capital receipts, including £130m from asset sales, with another £68m in sales planned this year.Yet despite what Perry has called "difficult decisions", the council's budgetary shortfall continues to grow.
'Blinkered denial'
Many councillors now believe only a full government bailout can break Croydon's debt cycle, though such a move would be unprecedented.Perry said he holds regular meetings with government ministers, during which the need for a bailout is often discussed.Councillor Rowenna Davis, Labour's candidate for mayor, said: "To deny the need for commissioners is a blinkered denial of the financial danger we face three years into your leadership."She adding that Perry's attacks on the intervention were "insulting" to those trying to help.Croydon Council has officially opposed the commissioner proposal in the ongoing consultation, with several local charities also submitting objections.The consultation closes on 20 July, and further details on the government's next steps are expected later this year.
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