Birmingham City Council's 'devastating' budget cuts and tax hike approved

Birmingham City Council has approved plans to increase council tax by 21%, make £300m in cuts and scale back public services.

The Labour-run council declared itself effectively bankrupt in September last year, after identifying equal pay liabilities estimated at £760 million, and is now said to be on a “narrow path to financial sustainability” dependent on budget cuts.

At a full budget council meeting on Tuesday night, councillors made decisions regarding tax increases and cuts to local services.

More than 50 Labour councillors voted through a 2024/25 budget described by the city’s Conservative group leader as “a double whammy of higher taxes and fewer services”.

The five-hour council meeting was told £300 million of cuts over two years, including to library services, were needed to secure £1.255 billion in exceptional financial support (EFS) loans from central Government.

A separate motion recommending a council tax rise of 9.99% – taking annual bills for a Band D property to £1,793 – was also approved.

Birmingham City Council leader John Cotton apologised to the people of the city for the “unprecedented” cuts, telling councillors the “budget before council today is not the budget I entered politics to set”.

The financial measures have been described by councillors on the Labour-led council as "devastating".

Mr Cotton apologised "unreservedly" to people living in the city during the meeting on Tuesday.

He said: “It is not a budget I ever envisaged for our city. Sadly however, it is a budget that reflects the significant challenges currently facing this council.

“Because the harsh reality is we must make cuts of over £300 million over the next two financial years in order to receive exceptional financial support from Government and to meet the challenge set by commissioners.

“As the report before us states, that is unprecedented in scale and, for that, I unreservedly apologise to the people and communities of our city.

“The fact remains however that my task, as the new leader of the council, is to tackle financial and organisational challenges that have dogged this organisation for far too long.

“Quite simply, we must get our house in order, because the people of our great city deserve better.”

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Mr Cotton said he was committed to putting the City Council back on track, with significant work still required to stabilise the IT system and “to close off once and for all our equal pay risk”.

“Progress is being made, and I want to place on record my thanks to members, to officers and the commissioners who are working tirelessly to resolve these critical issues,” he said.

But Mr Cotton said the mistakes made in Birmingham had “not occurred in a vacuum” and councils up and down the land were facing a perfect storm of smaller budgets but higher costs, leading to widespread cuts to waste collection, road repairs and leisure services.

He told fellow councillors: “We have sought to protect the most vulnerable, with the highest percentage of cuts coming in back-office functions rather than in the high-demand areas of adult social care and children and young families.

“In addition we have safeguarded things like well-being centres and school crossing patrols.

“Lord Mayor, I regret that council tax bills will increase by 9.99% and I know that the timing of this increase could not be worse, given the cost of-living crisis that has been exacerbated by reckless national mismanagement of the economy.”

Here's a reminder of some of the proposals which have been voted on by 101 elected council members:

  • Fortnightly, rather than weekly, bin collections starting next year.

  • Reduced spending on highways maintenance - this means less money spent on roads, pavements and cycle paths.

  • Increased cost of death - burial prices will increase by 13.25% and the cost to buy a grave will increase by more than 10%.

  • Almost £24million will be cut from adult social care.

  • Less money for culture. This means grants to organisations including the Birmingham REP Theatre, City of Birmingham Symphony Orchestra and IKON Gallery will be cut 50% this year and 100% next year.

  • Support for Black History Month and Birmingham Heritage Week will face an 100% cut in council funding from next year.

  • Dimmed streetlights - streetlights will be less bright in order to save £900,000.

  • Reduced grounds maintenance.

  • Reducing mobile rubbish and recycling lorries.

  • Abandoning plans for neighbourhood action coordinators. This was a pilot scheme that focused on community safety and the local environment in Birmingham.

  • Leisure centres in Birmingham will focus on profits and review discount schemes and opening hours.

  • Council-run community centres will be at risk as the council will look to stop running these facilities.

  • The council is also proposing that some council buildings will be closed.

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