Six government commissioners and two political advisors have been appointed by the Department for Levelling Up, Housing and Communities to run Birmingham City Council following its Section 114 notice declaring effective bankruptcy.
The political advisors are experienced Labour politicians - John Hutton a Labour peer and former defence secretary; and John Biggs a former mayor of Tower Hamlets in London.
The six government commissioners will oversee a five year recovery plan for the Labour-run authority. They are expected to “advise and challenge” the council with their extensive powers, including the ability to amend budgets and appoint and sack senior staff, although most day-to-day decisions will be taken by the current management.
Birmingham, one of the largest local authorities in the UK, has £760m of liabilities for equal pay claims, a £100m bill to fix IT problems and a projected budget deficit of £87m this year. Government funding cuts have shrunk its annual spending by £1bn over the past decade.
It now faces painful decisions as it attempts to stabilise its finances. It may be forced to sell off land and high-profile assets, such as the city library and its museum and art gallery. There are likely to be big cuts to services, many staff redundancies, and a large rise in council tax bills.
The team is headed up by Max Caller, who has become the government’s go-to expert in recent years when it has intervened in local councils, having led recovery teams in Slough and Northamptonshire which were both declared effectively bankrupt.
Following the announcement of his appointment by Michael Gove, Mr Caller told the BBC: “Birmingham got itself into this mess and it is Birmingham that has to get itself out."
Each of the six commissioners have received a letter from the DLUHC Deputy Director for Local Government Stewardship Max Soule outlining their pay deals. You can see how much each commissioner is being paid below.
The letter also clearly states that “it is the Authority’s responsibility to meet these costs”. It is estimated that the total bill will be as much as £1.5m annually - so could cost up to £7.5m in total.
Leader of Birmingham City Council Cllr John Cotton and Chief Executive Deborah Cadman have vowed to work constructively with the commissioners, saying in a joint statement: "Our sole focus now is on working with the commissioners in a collaborative way to meet the immediate challenges and set the Council on the journey to long-term sustained improvement.
"That work is already underway and the expert input from the commissioners will be invaluable as we work to transform the council and get the budget back on track."
1. Max Caller CBE - £1,200 per day
Leading local government figure Max Caller CBE has been confirmed as the Lead Commissioner for Birmingham City Council. He is the former Chief Executive at Londn boroughs Hackney and Barnet and the Chair of the Local Government Boundary Commission for England. He has experience in multiple interventions, including having previously been Lead Commissioner at Slough, Lead Inspector for the Liverpool and Northamptonshire Best Value Inspections, and a Commissioner at Tower Hamlets. Mr Caller also has experience of working with Birmingham City Council, having been appointed by the Council as one of their Non-Executive Advisors following the non-statutory intervention.
2. John Coughlan CBE - £1,100 a day
Current Commissioner for Special Educational Needs and Disability services and former Chief Executive of Hampshire County Council. has significant expertise in local authority governance, is the former Chief Executive of Hampshire County Council and has extensive experience of local government interventions especially in children’s services. Mr Coughlan has been asked to focus on broad improvement, by supporting cultural change and transformation and driving forward work on the long-term sustainability of the Authority. His role will operate alongside his role as Commissioner for Special Educational Needs and Disability services in Birmingham, for which he reports to the Secretary of State for Education.
3. Chris Tambini - £1,100 per day
Former Director of Corporate Resources at Leicestershire County Council, where he has held other roles including Section 151 Officer and Head of Strategic Finance. He was the President of the Society of County Treasurers and also worked at city unitary councils. Mr Tambini will focus on the financial position and recovery of the Authority. This will include supporting the Authority’s work to develop and implement a plan for managing the significant equal pay liabilities that led to the Section 114 notices, and overseeing the steps needed to manage other budget pressures for 2023/24 and beyond, and to return the Authority to a position of long-term financial sustainability. It will also include considering what action may be necessary to ensure the Authority has appropriate and effective processes, governance and capacity in relation to its overall financial management.
4. Pam Parkes FCIPD - £1,100 per day
The current Executive Director for People and Transformation at Essex County Council, is a FCIPD qualified senior practitioner and was part of the Best Value Inspection Team in Thurrock Council. Pam Parkes will focus on supporting Birmingham to improve its Human Resource and Organisational Design capacity and to find solutions to the Equal Pay issue, including ensuring that appropriate steps are being taken at the required pace to address and manage its equal pay liabilities, in a way that is both sustainable and represents value for money.