Words by Ed King
Erdington Ward Councillor and the Leader of Birmingham Conservatives Robert Alden has stated Birmingham City Council (BCC) have “no grip of their mess” after it was announced earlier today the city had issued a Section 114 notice – effectively declaring bankruptcy.
Following the announcement, which stops any new spending other than costs incurred when ‘protecting vulnerable people and statutory services’, Cllr Alden issued a statement calling out the “Labour’s failure in Birmingham” and “refusal to deal with” historic issues over equal pay.
Cllr Alden went on the challenge BCC over its promises of a “golden decade” for the people of Birmingham, a phrase used in a financial plan issued by BCC in 2022 – under the then leader Cllr Ian Ward, and squarely blame the Labour run council for a “mess where residents will now lose valuable services and investment”.
Birmingham City Council has been facing a financial crisis for some years, after losing a landmark court case involving 174 former female employees over gender-based pay inequalities.
Heard in the Supreme Court in 2012, Birmingham City Council was legally obligated to meet backdated claims by thousands of staff – having reportedly paid £1.1bn over the last decade.
In 2014, the Council even sold off the National Exhibition Centre for around £300m to help meet their growing legal bills.
With a projected deficit of £87m projected for the next financial year, officers further informed the local Cabinet on 28 June this year the city would need to find a ‘between £650 million and £760 million’ for new claims over equal pay.
On 5 September, after the announcement of the Section 114 notice and immediate cease in any new spending, BCC Deputy Leader Cllr Sharon Thompson further stated: “whilst the Council is facing some significant challenges, the broader city is still very much open for business.”
Responding to the news, Erdington MP Paulette Hamilton told Erdington Local: “13 years of Tory austerity has left Birmingham City Council with a billion-pound hole in its budget and the historic £760 million-pound equal pay liability and the implementation of Oracle ERP system, reflect on the huge challenges that it faces.”
Over concerns the Erdington Constituency could be amongst the worst affected by cuts to new spending, she added: “My priority remains in making sure people in Erdington, Kingstanding, and Castle Vale get the services they deserve.”
But mirroring the sentiments of Cllr Alden, who further accused BCC of “lying to the people of Birmingham”, the Liberal Democrats were quick to lay the blame at Birmingham Labour’s feet.
In a separate statement, Liberal Democrat Group Leader Roger Harmer called out the “sheer arrogance” of an administration who “blame others for their inability to manage the council effectively.”