Birmingham city council ignored bankruptcy warning signs, says expert

Councillors at Birmingham city council “ignored the warning signs” of its financial crisis and caused a “self-inflicted” disaster that will take years of cuts to rectify, according to the lead government commissioner drafted in to help. Local government expert Max Caller, who has been nicknamed Max the Axe for his unsparing approach to budget cuts, was lured out of retirement to take on the task of fixing England’s largest local authority after it effectively declared itself bankrupt. “They should never have done this. They ignored the warning signs, crashed on regardless and they have created themselves a controlled disaster,” said Caller, who is five weeks into the task of pulling the local authority from the financial brink. The council issued a section 114 notice in September, largely due to a rapidly escalating equal pay claim bill of at least £760m and problems implementing a new IT system costing £100m. “There will be job losses, it’s inevitable. There will be some services that will no longer run, it’s inevitable,” Caller said. “It won’t be easy. It will be painful, and some things will get worse before they get better. But it will be a smaller, more focused operation at the end of it.”

https://www.theguardian.com/uk-news/2023/nov/12/birmingham-city-council-ignored-bankruptcy-warning-signs-says-expert

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