Minister sends team to 'take control' of Croydon

The government is sending in its own team to take control of a south London council that has gone bankrupt three times in the past five years.

Local government minister Jim McMahon said the scale of the financial difficulties facing Croydon Council and "the failure of the council to adequately respond to these difficulties" had led him to appoint commissioners.

The four commissioners will have powers over financial management and decision-making and the "appointment, dismissal and performance management" of senior council staff.

Executive Mayor of Croydon Jason Perry said the decision to appoint commissioners was "the wrong decision for Croydon and its residents".

Commissioners are appointed when a council is not performing its duties adequately, particularly in areas like financial stability and service delivery.

McMahon said "a short and sharp reset, with fast action, is required to shift the dial on the council's recovery".

In a statement to Parliament, McMahon said: "Croydon remains one of the most financially distressed councils in the country.

"Failing to change course would condemn Croydon's residents to a worsening position without a recovery strategy.

"I believe this is best achieved by escalating the statutory intervention to a commissioner-led model to ensure the council can achieve sustained change at the pace needed."

The council has to pay the costs of the commissioners, including their fees and expenses.

The minister said most decisions should continue to be made by the council but with the oversight of the commissioners who "will uphold proper standards and due process and recommend action to the authority".

Perry said: "It does not feel fair and consistent in line with the lower levels of intervention placed on other councils.

"I will not allow our residents to carry the cost of historic failure. I will not support any proposals that would destroy vital local services or impose further council tax increases above the government cap."

Perry also said the council would "engage with the government-appointed team constructively".

He added: "We will welcome their advice, challenge, and support, and we will continue to put Croydon's residents at the heart of every decision we make."

Croydon Council became the first London borough in two decades to effectively go "bankrupt" back in 2020.

It went on to declare bankruptcy for a third time in November 2022.

Perry promised to address the borough's £1.4bn debt burden when he was elected in 2023.

Recent cuts include the closure of four libraries in November 2024 and a restructure of the authority's Youth Engagement Team.

Council tax in Croydon has increased by more than 26% since 2022.

The Conservative-led council attributes its financial problems to a surge in homelessness and social care demand, along with rising costs for children's placements.

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