Birmingham City Council Goes Bankrupt

5th September 2023

All but statutory services stop from today.

Birmingham City Council has effectively declared bankruptcy after being hit with a £760m bill to settle equal pay claims. The council said it had issued a section 114 notice, confirming that all new spending, with the exception of protecting vulnerable people and statutory services, must stop immediately

Many services will be cut as soon as possible.

At least 30 per cent of councils in some of the poorest areas of the country are considering declaring effective bankruptcy this year or next, it has emerged.

A survey of 47 local authorities in the North, the Midlands and on the South Coast revealed the severe strain on finances meant five are currently in the process of deciding whether to issue a section 114 notice of their inability to balance their annual budget in 2023-24.

An additional nine councils which are members of the Special Interest Group of Municipal Authorities (Sigoma) said they may have to declare bankruptcy next year.