Former roads contractor Kier sues Croydon Council for £10m

CROYDON IN CRISIS: Just a couple of weeks after they took retirement from their six-figure salaried job at Fisher’s Folly, a former exec director is back, reportedly overseeing the council’s response to a potentially costly legal case. By our Town Hall reporter, KEN LEE

Road works: Kier worked for Croydon for seven years, but now have launched a £10m legal case

Katherine Kerswell, the chief executive of Croydon’s cash-strapped council, has come up with an ingenious way of dealing with the latest costly legal case to land on her desk: go and hire the person responsible for the mess to oversee the council’s response.

The Kier Group, the construction and engineering giant which carried out Croydon’s highway maintenance services in the borough from 2011 to 2018, began legal proceedings against the council in a contractual dispute. The claim at stake is said by sources at Fisher’s Folly to be around £10million.

The council was formally notified of Kier’s legal challenge just before the end of August.

Helping to oversee the council’s defence case is Steve Iles, who only retired from his six-figure salaried role as “director of sustainable communities” on August 31, after nearly 35 years working for the council.

He’s back: Steve Iles

Iles, 55, is believed to have walked away with an early pension package worth in the range of £130,000.

It will have been Iles working in a very senior position at Croydon when Kier were first brought in as roads contractors, and he will have been in charge of the council’s roads department when the decision was made to discontinue with their services five years ago.

Staff have only recently been advised of the appointment of Karen Agbabiaka as an interim replacement for Iles. The council began its recruitment for Iles’s replacement too late to ensure anything resembling a smooth transition, so have had to find someone to fill the vacancy, initially at least, on a temporary basis.

Agbabiaka arrives in Croydon with an impressive-looking CV, including heading the highways departments at Islington and, most recently, at Liverpool City councils, with a solid grounding in civil engineering. So that’s an improvement over her predecessor straight away…

From earlier this year, Agbabiaka has also been a non-executive board member of Active Travel England, which suggests a level of expertise that Croydon might well need in untangling and improving many of the LTN’s hurriedly, and often poorly, implemented under Iles.

It was Iles who launched a handful of new school streets without any enforcement cameras because the kit he ordered from the United States was not compatible for use in south London…

It could be February 2024 at the earliest before a permanent replacement for Iles is installed at Fisher’s Folly unless, of course, Agbabiaka decides she wants to stick around.

The next few months could prove critical in the council finding a replacement for its rubbish contractors, Veolia, another aspect of the busy brief that Agbabiaka is taking on from Iles.

At least Agbabiaka won’t have to go far if she needs to refer to him over any important matters.

Interim: Karen Agbabiaka

According to a source, “Steve is already back with the council, literally within days of his formal retirement, working on a day rate.

“He is working on the council’s countercase for the claim Kier has submitted.”

One of the factors that has seen Croydon accumulate its £1.6billion debt mountain is its systemic issue with paying people, or their private companies, enhanced day rates, as Inside Croydon has reported on many times.

There are many of them spread across the council, some of whom have been working there for more than 10 years. “One of their arguments is that it helps bring in or retain the talent,” said the source, “but if that’s the case why not just pay the right rates in the first place?

“Or if there is a need for a specialist skill for a short-term project, ensure that it is just for that and not a back door into a continuous roundabout of one project after another.”

Other council sources have confirmed that they are aware of the legal tangle with Kier, who today, when contacted by Inside Croydon, declined to go into any detail about the nature of the dispute.

But they would not deny that they had embarked on a legal case against their former clients.

“Any outstanding matters will be resolved through the appropriate contractual mechanism,” a spokesperson for Kier said.

So it looks like another set of outside contractors, lawyers, will be getting rich at the expense of Croydon’s Council Tax-payers yet again…

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• ROTTEN BOROUGH AWARDS: Croydon was named among the country’s rottenest boroughs for a SIXTH successive year in 2022 in the annual round-up of civic cock-ups in Private Eye magazine