A “damning” report into Haringey Council’s past property deals that suggests key information could have been leaked to a developer will be handed to the police.
The independent report, commissioned in response to allegations over a string of high-profile transactions, found information on development sites could have been passed to a developer by a representative of the council.
According to the report, which was written by local government expert Chris Buss following an investigation, a council officer received a call from the developer – referred to only as “developer A” and involved in multiple sites – about matters that were on a confidential cabinet meeting agenda.
The report states that there is “no way of knowing how the developer received this information, but it does demonstrate links between either officers or members and developer A,” adding that this could have been a “one-off occurrence”.
It notes that potential redevelopment sites were publicly known for “a number of years”, so a developer could research and acquire land that would give it a “financial advantage” – but it is also “conceivable” that information could have been passed on by a council representative.
Buss was unable to interview several individuals due to a live police investigation into allegations of fraud linked to a proposed development at former care home Cranwood House in Muswell Hill. But the report states that the “conclusions and recommendations” in the review are “valid”, adding that determining whether criminality was involved in any of the transactions is a police matter.
The 46-page report reveals that the council’s in-house property team was “run down” as part of the planning for the controversial Haringey Development Vehicle (HDV) – a public-private partnership due to start in 2018 scrapped following a change of leadership.
As a result, there was a “loss of corporate memory and a failure to adequately maintain records on property-related matters”. The report refers to a “political desire” to be seen to be delivering a commitment to build 1,000 council homes “at pace”, despite the “structures to deliver a scheme of this size and complexity not being immediately in place”.
It also details a “toxic” atmosphere in the Labour group between 2018 and 2021, adding that “a number of the decisions that led to purchases being made may have been made to keep political interest groups assuaged”.
The report considers nine transactions, most of which took place following the change in policy after the 2018 council elections.
One of these is the purchase of Alexandra House in Wood Green – bought by the council for more than £21million in 2020 after missing a chance to buy it for several million less in 2019.
The report reveals valuation briefs did not consider that the property could be bought by a developer for conversion into housing – which is what ultimately happened – meaning the council “eventually acquired the site at a higher price than it might have done”.
On Cranwood House – previously the subject of an investigation by the Local Government Ombudsman – the report states that the then-leader Joseph Ejiofor’s decision to unilaterally scrap the original version of the scheme in March 2020 “does not appear to be in line with council governance arrangements”.
The LGO previously said the council had not been even-handed in its approach to two residents whose homes were set to be demolished – one of which was bought by the council for £2.15m.
On another scheme, Gourley Triangle in South Tottenham, the report notes that in relation to one possible development agreement “there is no comprehensive audit trail to determine who authorised, decided or agreed anything”.
The report states that governance has recently been improved but sets out a number of key recommendations for the council to follow, including reviewing the leader’s powers and reminding both officers and members that information contained in a restricted cabinet paper should not be passed to a third party.
Liberal Democrat opposition leader Luke Cawley-Harrison described the report as “utterly damning” and claimed it painted a picture “of a completely inept organisation which has wasted millions in public money”.
He added: “The council’s failure to provide key information like audit trails or details of its property management system, which should be standard in any local authority, is at best indicative of extreme incompetence, and at worst deliberate obfuscation. “All administration councillors and council officers must continue to work with the police whilst their fraud investigation continues.”
Council leader Peray Ahmet said she had commissioned the review because she was “extremely concerned about allegations surrounding various historic high profile and controversial property transactions”. She Ahmet added: “We cannot change what happened in the past, but I am determined that we use this review to learn lessons and ensure we continue to build an effective property function with strong political oversight and transparent decision making. The report will be passed to the police.”
Former council leader Joseph Ejiofor said: “Issues flagged by this report are longstanding and predate both me and my successor’s leadership, but I’m glad that procedures will be both clarified and tightened up.”