Date when Birmingham City Council will announce cuts or sale of assets plans amid financial distress

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Birmingham City Council is set to make recommendations on cuts as it navigates ‘bankruptcy’ as leader meets with Levelling Up, Housing and Communities and Minister Michael Gove

Members of Birmingham City Council are facing tough decisions as they navigate the financial crisis before them - but when will residents find out if services are being cut and assets sold amid its effective bankruptcy?

Council leader John Cotton has met with Leveling Up Secretary Michael Gove to discuss the issues lying before the local authority amid senior councillors issuing a Section 114 Notice as the councils debts rose up to £1bn as it faces an equal pay liability of up to £800m and it announced that it needed £100m to fix its flawed IT system, Oracle, which was intended to help streamline payments across its public services.

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Mr Gove is expected to announce on Tuesday (September 19) that government-appointed commissioners will take over the day-to-day running of operations, including overseeing all key financial and seionr staffing decisions, according to The Times. The commissioners are expected to examine the books and make recommendations to Gove about what assets need to be sold to generate funds. Details of which services and or projects could be affected have not yet been announced.

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At a full council meeting on Tuesday (September 12) BCC Leader Cllr John Cotton  attempted to reassure the public and explained how social care and children’s services will remain the top priority despite upcoming council cuts in the wake of the city’s financial implosion. He said: “We will still be collecting your bins and we will still be providing care for your relatives, and we will still be looking after our children. And crucially, Birmingham is still open for business and there is a way forward.”

There is much speculation that the council may be forced to sell off its assets to generate funds to help the financial crisis. Mayor Andy Street recommended a three point plan to the government that includes requesting permission to use asset sales to meet equal pay liabilities as well as putting together experts to oversee a rescue plan, and holding a full and transparent independent inquiry into the council.

The council also owns around £2.4 billion in property, including the historic council house in Victoria Square and around 26,000 acres of land and 6,500 property assets (not including housing, infrastructure and schools) such as the Library of Birmingham, the Museum and Art Gallery, ASton Hall and Sarehole Mill. All of which could potentially now be sold to generate funds. The council previously sold several assets, including the National Exhibition Centre for £307 million in 2015.

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When will Birmingham City Council announce what assets it is selling and services it is cutting amid its financial crisis?

At the full council meeting earlier this week it was announced that an ‘extraordinary meeting’ has now been called for Monday, September 25 when city council leaders must present their financial recovery plan. It will also spell out where the axe will fall if any cuts are needed, and outline the next steps.

‘Birmingham is not bankrupt’

Addressing the West Midlands Combined Authority (WMCA) board on Friday morning (September 15) Cllr Cotton has been keen to stress that the city is “not bankrupt”, pointing to the presence of big firms which have chosen to relocate to the second city in recent years.

He also held up Digbeth’s burgeoning creative scene which will soon be home to a new BBC building and Peaky Blinders founder Stephen Knight’s studios. “Companies like Deutsche Bank, HSBC, Goldman Sachs and others are here because this is very much a city that is on the up,” he said.

“We are determined to get the city council back onto sound financial footing, so we can continue applying that collective success across the region in the years ahead. We certainly won’t shy away from the tough decisions that we’ll need to make.

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“And we’re also talking to our colleagues in the Local Government Association about creating an improvement board, with specialist experts in finance, IT governance, industrial relations and so forth to support us on our journey of recovery. Indeed, yesterday afternoon I met with Michael Gove, the Secretary of State, to discuss the way forward.

“Obviously, it is a challenging situation, but I just want to ensure colleagues on this board that we will do whatever it takes to deliver for the people of Birmingham, to play our full role in the region going forward. Clearly, that also means that we have to address some of the challenges that this combined authority faces as well.

“It’s a difficult time across the region, given the pressures that we see in our budgets, the fact that we’ve seen reducing resources made available to local government over a number of years.

“So we all face wider challenges in addition, but I just wanted to give that assurance to colleagues that that’s how we intend to take these matters forward and will continue to working with you to deliver for this region.”

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