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Big Brother

11 Apr

Wales_watching

As reported in today’s Newham Recorder, there’s more CCTV cameras in Newham than Waltham Forest and Barking & Dagenham boroughs combined.

We have an average of 16 cameras for every square mile of the borough.

And, not content with this, Sir Robin wants to take over the fleet of mobile enforcement cameras being deployed for the Olympics.

Residents of Newham are the most spied on citizens in our supposedly-free country.

5 Questions for Newham Councillors

26 Mar

On Wednesday 28 March Newham’s 60 Labour councillors and the mayor will meet to consider the latest developments in  the proposed joint venture with the Olympic Park Legacy Company (OPLC). If this goes ahead Newham – one of the country’s poorest boroughs – will invest £40 million and take an ownership interest in the Olympic Stadium.

At the meeting councillors will vote to exclude the public and the press. Key sections of the papers for the meeting have been restricted, so the public – whose money is going to be spent – will have no idea what is going on or why.

So ahead of the meeting here are 5 questions that councillors should answer before they vote on this:

  • What additional benefits will Newham people derive from the proposed £40 million investment that they will not get if the stadium legacy is wholly funded by OPLC?
  • If these benefits of ownership are so substantial – and so obvious – why aren’t the other Olympic boroughs taking a similar stake? For that matter, why isn’t the Greater London Authority?
  • Having read the business case for the investment (you have read the business case, haven’t you?) are you confident that it is built on solid financial and commercial foundations, that the investment is therefore low risk and Newham people are not going to be stuck with a bill for a white elephant?
  • Why are the public and the press excluded from all discussion about the new £40 million offer to the OPLC? This is an investment by one public body in another – there is no legitimate claim to be made for ‘commercial sensitivity’.
  • According to the draft statement of accounts for 2010/11, the council’s “total external borrowing at 31st March 2011 was £1,186 million. Given the current financial situation, is this really the time to be taking on another £40 million in debt?

 

Newham’s Debt Timebomb

28 Feb
Last year I wrote about the enormous debt racked up by Newham council in the ten years since Sir Robin Wales was elected as executive mayor.

As the result of recent correspondance with a local Labour party member, I thought I’d revisit the issue and explain a little more why it makes me feel so uneasy.

Of course public debt isn’t like personal debt, much as the Tories may try to persuade us otherwise. But equally local government debt isn’t like national government debt either. National debt for a country like the UK, which has a sovereign currency, is always ultimately repayable through creating new money (this is what the recent rounds of quantitative easing basically involved – creating new money to buy back old debt). Obviously it’s a last resort and can go disastrously wrong, as Mugabe demonstrated in Zimbabwe, but it means the UK can never go bankrupt and will never default on its debt.

But the same does not apply to Newham. We can’t print new money to pay off the debt, so the only options are taking on new loans to pay off the old ones or ensuring revenues exceed expenses and using the difference to pay down the loans. This latter option means raising taxes, cutting costs or a combination of the two. The former option will only work for so long, as eventually your line of credit runs out or the interest payments on the debt swell to an unsustainable point.

And it’s really the question of the interest that bothers me at this point. Sir Robin has been extremely fortunate to have been able to borrow and spend at a time of record low interest rates. If you look at the council’s accounts you will see that the cost of servicing the debt today, in cash terms, is the same as it was ten years ago despite the fact that there’s almost twice as much of it. But only a fool would believe that today’s historically low interest rates will last forever – or even for as long as the life of Newham’s loans.

So when interest rates start to go back up, the cost of servicing the debt goes up.

Where are those extra interest payments going to come from? Either more borrowing – which would be extremely foolish – or from revenues. Either council taxes have to go up sharply, or services have to be cut yet further. In Newham neither looks an attractive option: make some of London’s poorest people pay a lot more tax, or cut the services they rely on.

What Sir Robin has created is a debt timebomb. If he’s lucky, or astute, he’ll have moved on to bigger things (Lord Wales?) before it goes off. But the people who live and work in the borough will be stuck with the consequences.

 

A Parish Council for Forest Gate?

20 Feb

 

In 2007, the Government passed legislation which permitted the creation of community councils in London, with the aim of enhancing community governance in urban areas. These new community councils would have similar powers to the parish councils that exist elsewhere across the country.

Central government – both this one and its Labour predecessor – wants to encourage localism, a greater devolution of power and decision making to the lowest possible level. A Government white paper last year set out support for new parish councils and made it clear they wanted to see more councils established to take greater control over local services

Already local residents in Queen’s Park and London Fields have started campaigns to set up their own councils to change their community for the better.

Would it make sense for us to have our own council in Forest Gate?

It wouldn’t mean leaving Newham, just having some powers transferred into the hands of local people and an ability to spend money on the projects we consider priorities. For example, the new council would have to be consulted on any planning applications, such as the one submitted by Obsidian for the re-development of our town centre. The lack of effective planning enforcement is something that has long blighted Forest Gate Town Centre. Other possible powers which could have a positive impact on how we as residents could improve Forest Gate include managing community and leisure centres, establishing a ‘village hall’, street cleansing and community safety. It may even be possible to take over the local parking provision to ensure that it better reflects the needs and desires of the local population. 

The new council would be funded by a precept – an additional amount of money collected alongside the council tax. It might also receive a grant from Newham to enable it fund services it took over from them.

In order to establish a new parish council here Newham, as the ‘Principal Local Authority’, would have to first undertake a ‘community governance review’. They could decide to do this themselves, or we can petition them to do so. If 10% of the electors in the affected area signed the petition Newham would be legally obliged to carry out a review within 12 months. 

Together the existing wards of Forest Gate North and Forest Gate South are home to about 20,000 people, but the area covered by the council need not exactly match those boundaries. However, that makes a sensible starting point for thinking about this.

I think there are exciting possibilities here for local people to re-engage in the governance of our community, but what do you think? Is this an idea worth pursuing? Why not head over to Woodgrange Web and join the debate – http://bit.ly/yKo35I

 

Wanstead Flats in the snow

5 Feb


on Instagram http://instagr.am/p/oRjUA/ – February 05, 2012 at 11:37AM

A Conversation with Councillor Gray

4 Jan

In a comment on John Gray’s Labour Blog (which is actually it’s title, not a description I’ve given it) I asked, in relation to what I perceive to be a lack of transparency in the way Newham council conducts its business:

Why is vital business always conducted behind closed doors at Labour Group meetings rather than in public council meetings?

Why were the public and the press excluded from the [council’s] discussion about the new £40 million offer to the OPLC?

Councillor Gray replied:

I am amazed that there is anyone who can question the huge overall benefit from the Olympics and that any council (especially a Labour Council) would not want to have a direct public ownership stake in the stadium.

I was a Council officer (in a different council) for over 15 years and political groups have always debated and voted on policies in private.

Unsatisfied by this response, I pressed the matter further:

You say “I am amazed that there is anyone who can question the huge overall benefit from the Olympics and that any council (especially a Labour Council) would not want to have a direct public ownership stake in the stadium.”

Apologies if I’m being a bit thick, but I’m afraid you’re going to have to enlighten me. Whilst I agree that there will be overall benefits to London and the UK from hosting the Olympics (even at the vastly expanded cost of £9 billion) and I am personally looking forward to attending a number of events in the summer, I cannot see why Newham council would want to have a direct stake in the future ownership of the main stadium once the Games are over. If the benefits are so obvious, why aren’t Greenwich, Tower Hamlets, Waltham Forest and Redbridge taking a similar stake? Why isn’t the Greater London Authority?

Of course the Olympic stadium should remain in public ownership, but the OPLC is a public body, so Newham’s investment won’t make the ownership any more public than it already is.

The question therefore remains, what additional benefits will Newham people derive from the proposed £40 million investment that they will not get if the stadium legacy is wholly funded by OPLC?

The answers to that may lie in the report that you and your colleagues considered back in December when you approved the £40 million investment offer, but that document has not been published and your meeting was held behind closed doors. Quite why an arrangement between two public entities should be regarded as ‘commercially sensitive’ is beyond me.

Councillor Gray again responded:

Again, purely in my personal opinion, I don’t know why (and maybe they are putting in a bid for all I know) but suspect that the simple answer is that the stadium is in Newham. I also think that the GLA have no legal ability to do what you suggest. Nor at this time the political inclination.

The OPLC is a “public body” at the moment, but that doesn’t mean that it will be always.

Look, I believe in public ownership, I am a believer in “Municipalism” and that the role of a Council is not just to be an “enabler” of services. ??????The potential of the Stadium is enormous and IMO (sorry BBM) it is quite right and proper that the Council wants to play a prudent role in its future.

Whether you think it is a good thing or not all, public entities have a duty to negotiate to get the best commercial arrangement possible, whether it is a with a private or public body – so of course, you cannot make your negotiation position public.

Feeling that my basic question had gone unanswered, I tried again

You talk about potential and municipalism, but make no mention of concrete benefits to Newham people resulting from the £40 million we are putting in.

The business case for the investment that the council approved would have included some kind of benefits analysis as part of the return on investment calculation, so there must be a list of them written down somewhere. Why not just share that?

If this investment is such a great deal for the people of Newham, why aren’t the mayor and the council trumpeting it from the rooftops?

This prompted the following, frankly unenlightening reply

I honestly think that I have as much as is possible at this moment.

The key thing to remember at this time is that there is no “deal” to actually talk about. There is a proposal which is being negotiated. The proposal (as in any other negotiation) could be turned down, amended or withdrawn. In the midst of negotiations you just don’t generally trumpet things from the rooftops

And there I think we must leave it.

The post to which the comments were attached has sunk down below the first page of Councillor Gray’s blog and I sense that we’re really only talking to each other. To his credit John Gray has remained entirely polite in his replies to me, which is not a courtesy he always extends to commentors on his blog or others he perceives as political opponents. And at least he has a blog, which is more than can be said for the mayor or any of his other colleagues (as far as I am aware). 

Maybe at some point we’ll find out what we’ll be getting for our money, but I’m not holding my breath. Sir Robin is hell bent on taking some kind of control of the Olympic stadium, and spending a big chunk of our cash to do it. The idea that he might explain himself to the people who will actually paying for it is not one that will detain him, even for a nanosecond.

A Welcome Return

21 Dec

I’m glad to see that Mike Law has done a rapid u-turn and re-started his blog.

GIven the utter uselessness of the 60 Labour councillors when it comes to holding their mayor to account and the spinelessness of the Newham Recorder, Mike’s blog is pretty much the only place where serious questions get asked about what is going on in Newham.

Separated at Birth?

17 Oct

Sir Robin

Mayor_sir_robin_wales

Johnny from the X-Factor

Newham Council’s Mountain of Debt

3 Oct

People have expressed surprise that the mayor has proposed to borrow £40 million to lend on to West Ham United FC to part-finance their bid for the Olympic stadium. They ask how one of the poorest boroughs in London can afford to take on such debts.

What they obviously don’t realise is that Newham has already has massive debts. According to the draft statement of accounts for 2010/11, the council’s “total external borrowing at 31st March 2011 was £1,186 million.”?????? Against that, “the Council had investments of £303 million.”?????? Which leaves a net position of £883 million of debt.

That level of debt is truly shocking, but what is more alarming is the massive growth in those debts during the mayor’s reign.

As at 31st March 2002 Newham’s total external borrowing was £616 million. With investments of £91m that left a net debt of £525m.

Today’s total debt figure of £1,186 million represents an increase of 93%. Even taking the major increase in investments into account, the net debt position has increased by 69% over the past 9 years.

Although the council claims that the current debt is “well within [our] approved borrowing limit” it is a frighteningly large sum. According to the 2001 census (the most recent data on the council’s website) there are 91,822 households in Newham.

That means the council owes the equivalent of £12,916 per household.

 

Newham Councillors Paid More Than £1.2 million in Allowances

21 Sep

Last week the Newham Recorder published a story headlined Newham councillors getting £25k each expenses, claiming that the average councillor received £24,333 to service their wards.

The story also stated that “the basic allowance for councillors newly elected last year was reduced to £9,579.”

It is a sad reflection on local journalism in Newham that neither claim is quite correct. 

The £24,333 average applies if you only count the 40 members of the council who served the full 12 months from April 1 2010 to March 31 2011. It completely ignores those who left the council at the May election and those who joined after it. This tends to inflate the average, as those 40 councillors were generally more senior. 

The basic allowance, sadly, hasn’t gone down. The reason new councillors only got £9,579 was that they didn’t serve a whole year and therefore only received a pro rata portion of the allowance.

There are plenty of reasons to attack the mayor and his cronies for their free-and-easy attitude to taking home our money, but the Newham Recorder does none of us any favours by getting the numbers wrong.

So if the Recorder got it wrong, what is the truth about councillors’ allowances?

Well, in the year ending 31 March 2011 the 61 members of the council (the mayor and 60 councillors*) collected a total of £1,221,752 in allowances and expenses. This works out at an average of £20,029 per member.

But even this doesn’t really tell the full story, as some councillors get far more than others as a result of “special responsibilities”. The top 10 earners in 2010/11 were:

  • RA WALES   80,695
  • AR BAIKIE   49,776
  • IK CORBETT   42,811
  • RJ CRAWFORD   42,811
  • U  DESAI           41,776
  • C  McAULEY   41,776
  • A  KELLAWAY   37,002
  • JH LAGUDA   33,499
  • EH SPARROWHAWK 32,809
  • CW FURNESS 32,231

Councillor Baikie’s allowance includes an additional special payment for serving 2 six-month terms as deputy mayor.

The full report on members’ allowances in 2010/11 can be found here: http://goo.gl/EGDP7

When looking at the above figures it is worth remembering, for context, that average income for a household in Newham is £27,600 a year.

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* That is 60 ‘full-time equivalents’ made up of 39 people who served a full year, 21 who served 1 April to the May election and 21 new councillors who took over their seats and served from the May election to 31 March.