Birmingham City Council’s multi million budget cuts pass first hurdle - what happens next?

Birmingham City Council’s planned budget, and the enormous wave of cuts it includes, has passed its first hurdle and was signed off by the authority this morning (Tuesday, February 27).

The Labour-run authority has found itself in an alarming financial position due to a perfect storm of issues – including an equal pay fiasco, the disastrous implementation of a new IT and finance system, rising demand for services and the impact of years of austerity.

The crisis-hit council published a budget proposal last week, which sets out in detail how it intends to slash services across the city and hike council tax as it struggles with an enormous budget gap of around £300 million.

Youth services, day centres and early help services are all impacted by the proposed cuts and ‘reviews’ as well as bin collections, cultural organisation grants, leisure fees, waste prevention, street lights and much more.

What happens next? When will the budget be signed off at a full council meeting and will there be an independent inquiry?

Speaking at an ‘extraordinary meeting’ of the council’s cabinet this morning (Tuesday, February 27), council leader John Cotton described the level of proposed cuts as ‘unprecedented’ but insisted they had no choice but to face their challenges head on.

The Labour councillor went on to insist that there would be accountability for “what has gone wrong” at the struggling council. “I absolutely understand that many people in our city will be worried,” he told the meeting.

“I’ve been clear right from the start that there are Birmingham specific problems that we have to fix, notably our historic equal pay liability and the issues around the implementation of the Oracle IT system.

“I’d like to reassure the people of this city that works are already underway to resolve these issues. There will be accountability for what has gone wrong,” he continued. “I’ve insisted the government begins the independent inquiry into that as soon as possible.”

Following Tuesday’s cabinet meeting (March 5), the full council now meets on March 5 to sign off its budget.

Is central government to blame?

The council leader has previously pointed the finger at the Conservative government and argued that the consequences of austerity, as well as the hollowing out of local government, had played a role in the council’s downfall.

“The fact remains that the majority of cuts we’re having to make are down to inflation and increased demand in areas like social care,” Cllr Cotton said at the meeting. That does reflect a wider crisis with councils of all political persuasions.

“I’m not seeking to make any excuses but the mistakes made in Birmingham have not occurred in a vacuum and councils are facing a perfect storm of smaller budgets but higher costs.

“I’m deeply sorry that we’re in this position and that council tax bills will increase – I know the timing of this increase could not be worse given the cost-of-living crisis.” 

‘Unacceptable’

Cllr Robert Alden, Conservative leader at BCC, described the crisis as “unacceptable” and urged the council’s administration to “start owning up to their mistakes.”

Councillor Ewan Mackey, deputy leader of the Conservatives, also recently warned: “Youth services, libraries, street cleaning, bin collections, school transport – little will go untouched and few people will be unaffected”.

Liberal Democrat leader Roger Harmer meanwhile told the meeting that the cuts to local services and rise in council tax would have a “long-standing impact on our city.”