Stadium latest

11 Sep

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A stone’s throw from the Olympic stadium…

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Not just a river in Egypt

8 Sep

My blog post yesterday prompted a flurry of media interest, which resulted in the following statement being issued (my emphasis added):

A Newham Council spokesperson said: 

“The Council’s draft accounts for 2016/17 were first published on our website on 3 July and were then open to the normal period of public scrutiny until 11 August. These draft accounts are currently with our auditors for their review. The finalised accounts are due to be considered at a scheduled meeting of our Investment and Accounts Committee on 20 September.” 

“Our draft accounts, which are subject to change and approval, show a prudent, responsible and regulatory compliant treatment of a Council loan related to the London Stadium. The loan is shown, for accounting purposes, as currently ‘impaired’, or damaged, due to the current financial performance of the Stadium. It is not a write off of the loan.”

The draft statement of accounts, which I linked to in my post, says on page 12 (again, my emphasis added):

“These charges are subsequently written-off to the Capital Adjustment Account.”

If Newham don’t want people thinking they’ve written things off they should probably avoid using the words ‘written-off’ in the accounts.

But let’s not split hairs. Let’s accept that the loan is indeed, as that spokesman says, “‘impaired’, or damaged, due to the current financial performance of the Stadium.” And then compare that to what Sir Robin said when the loan was first taken out (my emphasis added):

“Even on the most disastrous figures, even if everything goes wrong, we still make a profit on this.

“The risk is really, really minimal.

“The debt, which costs our residents nothing, will be repaid and then we start to share in the profit.“

Just one season into the operation of the stadium and it turns out that not a word of this true.

The Investment and Accounts Committee meeting on 20 September is a joint meeting with the Audit Board. It is public and details are on the council website. I predict the public gallery will be busier than usual.

UPDATE (13/09/2017): The meeting has been moved to Wednesday 27th September. Same venue: Committee Room 2, Newham Town Hall, East Ham, E6 2RP.

Down the drain

7 Sep

Sir Robin Wales is about to flush £40 million of council taxpayers’ money down the toilet.

Detail hidden in the draft accounts due to be signed off by cabinet tonight shows that the ‘loan’ made to help transform the 2012 Olympic stadium into West Ham United’s new ground is being written off.

Newham Council ‘invested’ £40m via a special subsidiary company called Newham Legacy Investments Ltd.

At the time, Mayor of Newham, Sir Robin Wales stated:

“Our investment of £40 million secures that legacy by transforming the Olympic Stadium into a world class attraction […]. This will provide us with a share of the profits generated over the long-term and a range of community benefits for Newham residents.”  

After just one season of operation as a football stadium the council is now ‘writing off’ that £40m investment. A line in the Draft Statement of Accounts 2016/17 states:

“Impairment totalling £44.4m of a Long Term Debtor in one of the Council’s group undertaking, Newham Legacy Investments Ltd” (page 12, item 7) 

and 

“The company’s 2016/17 financial results disclosed a loss of £2.5m (2015/16: loss of £41.6m), and net liabilities of £44.4m (£41.9m of net liabilities as at 31 March 2016).” (page 88, item 39)

Newham Legacy Investments Ltd has had a number of directors over the last five years including senior council officer Zoe Power (Head of Projects and Programmes, Newham) and Cllr Lester Hudson (deputy Mayor, Cabinet member for Finances and Chair of Audit board). Given that the audit board should scrutinise decisions made by cabinet, council and council-owned subsidiaries this combination of roles was a massive conflict of interests.

While Newham handed over £40m to convert the stadium, West Ham United themselves only contributed £15m, despite being owned by two multi-millionaires and the Premier League being the richest in the world.

The £40m being written off is double the amount of ‘savings and efficiencies’ being made this year. Residents were promised the investment would provide Newham with a share of the profits generated over the long term. It turned out be a gift to Messrs Sullivan and Gold. The money, borrowed by the council from the Treasury, will now have to be re-paid by local taxpayers.

This blog has regularly cast doubts on whether the other commitments including local jobs and tickets for residents have been delivered.

This is not Newham’s first Olympic investment to back fire. In 2012 it also had to write off more than £3m invested into London Pleasure Gardens. With additional liabilities added on, taxpayers were left close to £5m out-of-pocket.

All-in-all, Sir Robin’s track record on finance (under the ‘scrutiny’ of the double-jobbing Cllr Hudson) is not impressive.

Which makes this week’s news that Newham council has bought a multi-let office block in Redhill, Surrey for £25m all the more worrying.

Hey Porsche

25 Aug

Ayesha Porsche Tweet

My heart goes out Beckton’s lead community councillor, Ayesha Chowdhury. Her beloved white Porsche was stolen from her driveway last night.

The Twitter announcement attracted two ‘likes’ before being deleted. Such cruelty. Who celebrates a Labour councillor in one of London’s poorest boroughs being deprived of their high-powered luxury German sports car? 

And this is not the first piece of ill-fortune to have befallen her. In 2011 she had to move out of her housing association property when the national media focused its attention on her buy-to-let portfolio in Newham, then valued at over a million pounds. 

Happily for her, the soaraway London property market has since inflated her wealth to over £4 million, with an estimated monthly rental value of close to £19,000.

So if the Porsche doesn’t come back she can probably afford a new one.

Time after time

15 Aug

By the time next year’s election rolls around 15 current members of the council will have held their seats continuously for 20 years or more.

The table below shows exactly how long they’ve been around

Name Date elected Years to date
A SINGH 04/05/1978 39.31
C McAULEY 06/05/1982 35.30
R WALES* 09/07/1992 25.12
I CORBETT 09/07/1992 25.12
L HUDSON 05/05/1994 23.30
E SPARROWHAWK 05/05/1994 23.30
N WILSON 05/05/1994 23.30
C FURNESS 01/05/1997 20.30
Q PEPPIATT 01/05/1997 20.30
U DESAI 07/05/1998 19.30
R CRAWFORD 07/05/1998 19.29
J LAGUDA 07/05/1998 19.29
W VAUGHAN 07/05/1998 19.29
P SATHIANESAN 07/05/1998 19.29
P HOLLAND 07/05/1998 19.29

 *Robin Wales was also previously on the council from 1982 to 1986.

When local branches meet this autumn to select their candidates, one thing they should consider is the urgent need to freshen up the Labour group.

NOTE: The original version of this post stated that 16 members will have held their seats for 20 years or more and the table included Cllr Bryan Collier. It has been pointed out that Cllr Collier was defeated at the 2006 election and returned to the council in 2010, so his current continuous service is just over seven years; first elected in 1994, his total period as councillor is more than 19 years. The same is true for Cllr Alan Griffiths.

Personal Trainer

10 Aug

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Assistant chief executive and alleged Labour press flak Douglas Trainer

An intriguing and disturbing FOI request to Newham Council (links added):

The newly promoted Mayoral advisor Cllr Patrick Murphy was the Newham Labour Party procedures secretary to the recent Mayoral trigger ballot. When he has been contacted by journalists interested in the allegations made about this process he has told them to contact the Newham Council Assistant Chief Executive, Douglas Trainer for comment.

Mr Trainer is paid by Newham Residents £111,000 per year and is in a politically restricted post.

  1. Please confirm that Mr Trainer has contacted or discussed the Labour Party Mayoral trigger ballot (and anything associated with it) with any journalist.
  2. If so the names of these journalists; when; where; how and what he said to these journalists and why he has acted as a spokesperson for the Labour Party.
  3. I understand that there are tape recordings of these conversations.
  4. Please list the social events that Mr Trainer has attended with member of Newham Labour Party including at Labour Party conferences.

If the allegation here is true, it is extraordinary. Why on earth would Cllr Murphy think it appropriate to refer press enquiries about an internal Labour election to the assistant chief executive of the council?

And why would Mr Trainer agree to respond to them? He is explicitly forbidden from “acting on behalf of the party … in dealing with non-party members.”

This is no doubt a consequence of Labour’s total grip on power in the borough. Senior officers and councillors alike have come to believe that the council and the party are one and the same.

Note: I linked to the LB of Havering guidance on politically restricted posts because no equivalent page appears to exist on Newham’s website. Which is in itself telling.

Cunning stunt

9 Aug

Cunning Wales 3

A quiet word in your ear, Sir Robin…

If you were an electorally unsuccessful Scottish Labour politician looking to make a fresh start down south, where would you head for?

Newham might look like a pretty good option.

Certainly Barrie Cunning thinks so. He stood for Labour in the Scottish parliamentary elections last year and came in fourth, all-but-halving the party’s vote in the process. Now he lives in Canning Town and has his eyes firmly fixed on a seat in the council chamber.

As if being a white Scottish male wasn’t advantage enough, a bit of good luck has helped get him further into Sir Robin’s good books.

Back in February, Sir Robin was invited to speak at an Edinburgh Networking Breakfast event on ‘Building Partnership in Development.’ According to the mayor’s register of gifts and hospitality, his flights and accommodation were paid for by Newington Communications, the PR firm Barrie Cunning happens to work for.

And when the mayor took his trip to Cannes in March, one of the sponsors was Berkeley Group. They are clients of Newington Communications. According to his profile, Barrie Cunning works across the development and housing sectors.

So, let me be the first to say “Congratulations on your election, Councillor Cunning.”