Birmingham City Council, England’s second-largest city, declared bankruptcy on September 5, suspending all but essential spending. Birmingham City Council issued a 114 notice last Tuesday, joining a series of local authorities including Woking, Croydon and Thurrock, announcing they had no resources to make ends meet and the UK now exists. hand to mouth”.
So far, Conservative Chancellor Rishi Sunak’s government has refused to bail out Birmingham City Council. The government already provides extra funding to councils, worth around 10% of the budget, but “this is for locally elected councils to manage their own budgets,” Chancellor Rishi Sunak’s spokesman Max said.・Mr. Blaine told reporters.
What is Notice 114?
A section 114 notice is issued when the council determines that the income does not meet the expenditure. Thurrock, Croydon, Slough, Woking and Northamptonshire have all issued section 114 notices in recent years.
This notice means that all but essential spending will be suspended to protect core services.
How did Birmingham City Council go bankrupt?
– Most local reports blame the bankruptcy of England’s second-largest city on demands by its female residents for equal pay. In July, Birmingham’s Labor-led council estimated that equal pay claims by female staff could cost it up to £760 million. INR78 billion).
In June, the council paid £1.1bn to women workers, but it still has debts of between £650m and £750m, accruing at a rate of between £5m and £14m a month. It was revealed that
-according to daily mail, Birmingham City Council spent millions on “failing IT systems” by Oracle. The IT system was expected to cost him £19 million, but because its implementation was delayed for three years and problems arose after implementation, it is now expected to cost him £100 million.
-Birmingham City Council also spent an extra £184m last year on its expensive bid to host the Commonwealth Games.
-Birmingham City Council has raised nearly £90m from its controversial Clean Air Zone, which resulted in more than £50m going back into hydrogen buses and cycle lanes, the report goes on to say.
-Other costs include a £13m investment in the 2026 European Athletics Championships, as well as undisclosed spending on a range of ‘comprehensive’ road signs and an ambitious ‘green roads’ scheme is included.
– Inflation, rising demand for adult social care and a “significant decline” in business tax revenue have been touted as reasons behind the crisis.
Birmingham equal pay debate
Street BBC, in 2012, a group of 170 women, including teaching assistants, cleaners and catering staff, won the right to pursue an equal pay claim with the Supreme Court’s Council. They argued that the city council had failed to provide them with benefits and pay equivalent to men doing comparable work.
The financial crisis facing UK councils
according to guardian According to the report, the Local Government Association (LGA) estimates that councils face a funding gap of £3 billion over the next two years to maintain services at current levels.
Services currently operated by Birmingham City Council
– Adult education services
– Aged well service
– Parks, leisure and health
~Supporting a healthy life~
-Voluntary and community health and care services in Birmingham
Birmingham City Council will now have to prioritize its core services, while other services in the city will lose the funding they rely on.
“Councils do not have sufficient resources to meet equal pay spending and currently have no other means of meeting this responsibility. This means we must stop spending immediately,” Birmingham City Council said in a statement.
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Updated: September 9, 2023, 3:49 PM IST