A crisis-hit London council has held a meeting in secret where its chief executive was awarded a payout of more than £230,000 after suddenly resigning less than two years into the job.
Newham, which is on the brink of bankruptcy, called an emergency meeting of all councillors at its town hall in Stratford on Thursday night and appointed it sixth chief executive in seven years.
Members were told Abi Gbago had resigned after less than two years in the post and were asked to vote on her “substantial” payout.
Paul Martin was announced as her interim replacement and becomes the sixth chief executive to take on the job since Labour mayor Rokhsana Fiaz took control of the borough in 2018. Four have been interim posts and two permanent.
A source said the report being discussed contained a “series of concerning allegations” but there is no suggestion of wrongdoing on Ms Gbago’s part.
It is understood Ms Gbago was asked to sign a Non-Disclosure Agreement (NDA) before leaving to take a “career break”.
"Newham is a wonderful borough and one I have been proud to serve,” she said in a statement.
“I am grateful for all the support and encouragement I have received from within and outside the council.
“I wish the council well on the next stage of its journey. I will miss all of the workforce, elected members and partners that I have had the pleasure of working with, but it is time to rest and reset after navigating the council through a busy nearly two years"
The public and press were barred from attending the meeting. But the Standard understands Ms Gbago‘s payout will amount to over £230,000.
In May, the Government announced it was monitoring the local authority amid concerns about the town hall’s finances, culture and the value it is providing for taxpayers.
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The Ministry of Housing, Communities and Local Government (MHCLG) issued a “Best Value Notice”, which means the council will be observed for 12 months to ensure it is improving.
Ministers were concerned that “significant value for money weaknesses” had been identified as well as “cultural and governance issues”.
They also had “significant delivery concerns about some of the programmes delivered by the authority”, particularly housing.
Newham has been handed the worst ever rating issued by the Government regulator for the state of its social housing amid warnings tenants were being put at “unacceptable risk”.
Ms Fiaz in December settled an Employment Tribunal claim brought against her own council.
The directly elected executive mayor alleged race and sex discrimination. She later withdrew the claim and the local authority agreed to pay £36,000 toward her legal costs, as part of the overall settlement.
It came as Newham residents saw a 9% council tax hike in April - almost twice the amount allowed elsewhere in the country - when the town hall argued it would go bust without increased financial support.
The borough was forced to implement a raft of extreme cost cutting measures and requested emergency funding from central government as the cost of housing homeless families pushed it to the brink of bankruptcy.