Birmingham facing another 10pc council tax hike and price rises for leisure, sport and rubbish

The council’s unprecedented budget this March saw a huge wave of cuts to services, as well as a council tax rise of just under 10 per cent, as the authority grappled with a black hole in its finances.

According to a report, published prior to today’s cabinet meeting, the current estimated budget gap for 2025/26 stood at around £47 million.

At the meeting, plans to increase a vast array of fees and charges, including those for leisure and sport, bereavement services and rubbish disposal, from January 1 next year were given the green light.

Speaking to the Local Democracy Reporting Service afterwards, council leader John Cotton discussed what Brummies could expect from next year’s budget.

“We’ve still work to do to bring the budget fully back into balance,” he said. “We’re reliant on exceptional financial support still which effectively means we’re in a deficit budget situation.

“The priority has to be ensuring our income meets our outgoings.”

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He acknowledged the council had to take “a lot of tough decisions” this year and that progress was being made on delivering savings.

“We’re again looking at all areas of council activity for the budget proposals that we’ll bring forward in January,” he continued. “However, one of the challenges that we’ve laid down to the council and to [Joanne Roney, managing director] is we want to see more emphasis on efficiency and transformation, and less on the impact on frontline services.

“The salami slicing of services is not a long-term solution – we need to see a more fundamental transformation.”

READ MORE: Erdington reacts to Birmingham City Council cuts and tax rises as budget savings announced

He said this could involve ‘catching up’ on what other councils were doing and becoming “leading edge in local government again”.

“That doesn’t mean there won’t be some tough decisions we’ll still need to take,” he added. “But it has to be around how we change the way we do business, become more efficient and more technological adept.”

In the report, government-appointed commissioners sent in to oversee the council’s recovery said there was scope to make savings and the “vast majority” could be through transforming services.

On the prospect of another council tax rise, Coun Cotton said: “We’ve taken no decisions as yet on council tax levels but we did seek permission for two years of 9.99 per cent.

“We will need to look at the budget in the round before we take a final decision on council tax.

“What I can say, though, is regardless of what decision we may take, the council tax support scheme remains in place which provides protection to around a quarter of the city’s households, with the poorest being completely exempt from paying council tax altogether.

“That protection will remain in place.”

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With Birmingham now having three tiers of Labour government following this year’s general election, Coun Cotton said a priority for the party was growing jobs and opportunities as the council looks to overcome its financial woes.

“We need growth but we need fair and inclusive growth so every part of the city can benefit,” he said. “We’ve got to end Birmingham’s tale of two cities.

“What we’ve got to do, working with government and Richard Parker as the new Labour mayor of the West Midlands, is look at how we open up those opportunities, what we need to do around skills, early interventions and working with our business community more.

“That’s how the country grows and how we can ensure the city council’s coffers are replenished with new business rates and council tax but also everybody gets to feel the benefit in their wallets.”

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The city council found itself engulfed by a financial crisis amid 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.