Call for city council to ‘get a grip’ on finances

Last September, the city council (BCC) issued a Section 114 notice – an admission it was seriously struggling with balancing its books.

The local authority had found itself facing Birmingham-specific issues, such as an equal pay fiasco and the disastrous implementation of a new IT and finance system, as well as the rising demand for services and funding cuts.

Since that startling moment 12 months ago, a lot has happened in Brum.

The city has seen government-appointed commissioners swoop in to oversee the Labour-run council’s recovery and an unprecedented budget with a huge wave of proposed service cuts passed through in March.

With libraries, bin collections, day centres, youth services, arts and culture, street lights and more being impacted, the past few months have also seen Brummies fighting back and taking to the streets in protest.

However, there are also concerns that there could be further misery for residents to come.

A recently published report stated that commissioners are of the view the council “does not have sufficiently robust plans” to balance the budget in 2025/26 and subsequent years.

“Commissioners agree the themes set out in the report are appropriate,” it continued. “However, we are not confident that the council can deliver sufficient savings to bridge the budget gap”.

This latest update was met with alarm from opposition councillors this week, who urged the council to “get a grip” on its situation.

Robert Alden, leader of the Conservatives at BCC, said: “It’s deeply worrying that the Labour administration still doesn’t have a sufficient plan in place to right the council’s finances.

“They’ve already hit residents with their double whammy of a council tax rise and fewer frontline services.

“If Labour refuses to adjust their strategy and get a grip on this appalling situation, then residents will be hit harder than ever.”

Councillor Ewan Mackey, deputy leader of the Conservatives, added: “The Section 114 notice should have been a wake-up call but one year on we appear to be no better off, with Labour being warned that they still lack a credible plan to balance the books.”

The new report by the council’s finance director, set to be considered by cabinet next week, said the local authority’s financial position “continues to be of significant concern”.

“Commissioners are aware that turning the council around is a difficult task and want to work collaboratively with members and officers,” it stated.

“The financial challenge belongs to everyone and until this is the case, we believe the authority will struggle to become financially stable”.

The commissioners went on to say that they understand the council is considering options for balancing the budget over a longer period.

“To deliver c£195m savings next year would be challenging for any organisation,” they said.

“However, completing the task over a longer period will cost more and prolong this challenging period.

“The council needs to understand the consequences of this approach.”

The report continued that it’s crucial the council “maintains its focus and determination” to navigate the financial challenges ahead.

Councillor Rob Pocock, the cabinet member overseeing the council’s transformation, previously said that the new Labour government could be a cause for optimism.

“At last we are in a position where we have a government that’s prepared to give a long-term funding settlement to local government,” he said shortly after Keir Starmer’s victory in the general election. “That will enormously improve our ability to confidently forecast the financial position of the city in the future.”

On plans to transform the council, he added: “We are very far away from relaxing and letting things drift along.

“There is underway an intensive programme of work as we speak to address the planning of the budget for 2025/26 and beyond.”

In the past, BCC leader John Cotton has argued the previous Conservative government of neglecting local government while Tory politicians, such as former Prime Minister Rishi Sunak, have highlighted mistakes made by the council’s Labour administration.