£175 million Cuts. Official!
Earlier this week, ( 06/08/24), the Overview and Scrutiny Committee met, together with Mayor Fiaz and Finance Czar, Zulfiqar Ali. These senior backbenchers continued to be concerned that the council’s finances might be a problem. In short, their concerns, which had been echoed on this website and in the press, were that Newham is heading for financial disaster.
In casual language, it is asserted that Newham is heading for ‘bankruptcy’. Because the law will not allow a council to go bankrupt, mechanisms have been put in place, under the Local Government Act, to ensure that the unelected director of finances takes control of all spending by the council before that happens and politicians are kept out of the loop.
This is in section 114 of the 1988 Act, hence references to a s114 order.
That is the background and backbenchers were reasonably concerned that this was the direction that Newham was heading.
But it seems that their concerns were unjustified. Mayor Fiaz has everything under control.
Fiaz had previously told a meeting of all councillors that “Newham is not going bankrupt”. That’s good news. She has a solution. Over the next three years Newham will make cuts of £175million.
On to the meeting. Fiaz arrived late, (and left early). The committee was treated to the familiar refrain. Newham’s financial woes were the fault of the previous regime. The fault of the Tories. And definitely NOT her fault.
When questioned about her policy decisions she reverted to, a now common response. Instead of answering the questions she made attacks on her interlocutors and had to be called to order by the Chair, Cllr McAlmont. Committee members were, apparently, exhibiting intimidatory body language, by “shrugging” and they were “rolling their eyes”. One might consider that the mayor is slightly oversensitive, or insecure, or that she might be exhibiting the merest hint of hypocrisy. She can verbally attack members of the council. They may not “roll their eyes”.
The proximal cause was the overspend on temporary accommodation. But members of the committee were also concerned about the additional spending on the bridge at Royal Wharf, the unchecked spending on the mayor’s pet projects, a deteriorating budget position over five years, the mayor’s failure to utilize the authority’s capital assets etc.
In a meeting which began to look increasingly like the December 2022 meeting, (the one that sparked a round of mutual complaints and an investigation and report costing upwards of £20k), the mayor responded to the impudence of councillors by acting as if they had no right to question her.
We have to acknowledge that three at least, (two Labour councillors and one Independent), did want the mayor to take accountability and credit goes to councillors Paul, Mirza and Hudson. Councillors Paul and Hudson have both held the Finance brief on the cabinet, so when they are concerned, there is reason to believe that there might be a problem.
Mayor Fiaz absented herself from the meeting early, leaving her finance cabinet member, Cllr Ali and the Director of Resources to respond to members. It must be said that Cllr Ali looked to be out of his depth. His response to the looming crisis was to ask councillors to make suggestions about where the cuts should fall. It doesn’t fill you with confidence.
The issue is clearly one which the current regime finds sensitive. But £175m of cuts has got to be a problem for anyone. (Let’s hope that the trade unions don’t find out!)
Wags have suggested that Fiaz has been trying to mask any focus on the financial plight of the council. That, it is said, is why the cabinet meeting on the finances was broadcast on video without sound! We are more inclined to believe that this was incompetence rather than a conspiracy.
On an unrelated note, we learn that some members have noted an apparent sugar-dependency on the part of the mayor; she seems to rely upon a constant supply of sweets to get her through meetings. This, it is suggested, is the reason for her gradually increasing girth.