Britain’s second-biggest city effectively declared itself bankrupt on Tuesday, shutting down all nonessential spending after being issued with equal pay claims totaling up to £760 million ($956 million).
Birmingham City Council, which provides services for more than one million people, filed a Section 114 notice on Tuesday, halting all spending except on essential services.
The deficit arose due to difficulties paying between £650 million (around $816 million) and £760 million (around $954 million) in equal pay claims, the notice report says.
The city now expects to have a deficit of £87 million ($109 million) for the 2023-24 financial year.
Sharon Thompson, deputy leader of the council, told councilors on Tuesday it faces “longstanding issues, including the council’s historic equal pay liability concerns,” according to the United Kingdom’s PA Media news agency.
Thompson also blamed in part the UK’s ruling Conservative Party, saying Birmingham “had £1 billion of funding taken away by successive Conservative governments.”
“Local government is facing a perfect storm,” she said. “Like councils across the country, it is clear that this council faces unprecedented financial challenges, from huge increases in adult social care demand and dramatic reductions in business rates incomes, to the impact of rampant inflation.”
“Whilst the council is facing significant challenges, the city is very much still open for business and we’re welcoming people as they come along,” she added.
A spokesperson for UK Prime Minister Rishi Sunak told reporters on Tuesday: “Clearly it’s for locally elected councils to manage their own budgets.” The spokesperson added that the government has been “engaging regularly with them to that end and has expressed concern about their governance arrangements and has requested assurances from the leader of the council about the best use of taxpayers’ money.”
The council’s leader John Cotton elsewhere told the BBC that a new jobs model would be brought into the council to tackle the equal pay claims bill.
The multicultural city is the largest in central England. It hosted last year’s Commonwealth Games, a major sporting event for Commonwealth countries, and is scheduled to hold the 2026 European Athletics Championships.
This article goes into it in more detail
https://www.theguardian.com/society/2023/sep/05/councils-in-england-in-crisis-as-birmingham-declares-itself-bankrupt
Thanks for the info. We have better reporting on Lemmy than on CNN.
That's because modern journalists are hardly anything more than stenographers most of the time.
99% of them just cut and paste information from elsewhere online. Capitalism has almost completely killed legitimate investigative journalism.
In 2008 I worked in News Production for a local television station. There are two examples that come to mind to show how shallowly they train journalists.
First, there was NASA, they were doing testing of new lunar rover they planned to send back to the moon in a city a little over an hour and a half away. I brought it to the attention of our news department who quickly chided me with "isn't that outside our coverage area?" as if we didn't have a website that broadcasted to the whole planet, technically. Well, we only got coverage because me and another guy from Production called the NASA press corps and got an invitation for our news station. We went to the news manager and they sent someone out, but we never got any video online. For the next week, still photos from the test were the top story on WIRED's website for over a week. We could have had that traffic, but nope. "Outside our coverage area."
Another time was when there was a scandal with an official running for office. It was the governors race, and weeks before the vote, a new case was dropping that was showing one of the two candidates for governor getting illegal funding for his campaign. I went to the site of the prosecutor, downloaded all the relevant data, and put it on journalists desks. I got asked by the Producer "Are you sure this is true? I didn't see anything on AP Newswire." Jesus tittyfucking Christ I guess these people had never heard of BREAKING A FUCKING STORY before. We ended up running it after about ten different State papers ran stories about it, because apparently it's not news unless someone else reported on it first and you just do a copy-paste job from AP Newswire.
Not surprising considering most of us do not pay for news anymore.
That's the hard truth. Real journalism costs money. Muckraking and yellow journalism comes pretty cheap.
It's why misinformation is free, but quality journalism is behind paywalls.
Example: The good information we got was from The Guardian, which is funded by an endowment trust.
https://www.theguardian.com/gnm-press-office/2023/jul/25/guardian-media-group-plc-gmg-publishes-202223-statutory-financial-results