Latest Public Sector News

09.11.16

Birmingham faces ‘mammoth’ task of balancing £49m overspend

Birmingham City Council will face a ‘mammoth’ task in balancing its 2017-18 budget after an enormous £49m overspend this financial year, its improvement panel has warned.

The Birmingham Independent Improvement Panel (BIIP), tasked with supervising the council’s reform plan, has written a letter to the local government secretary Sajid Javid putting the overspend down to “flawed planned and insufficient delivery” of the council’s 2016-17 revenue budget, which will force it to deplete its transitional reserves next year.

The council has acknowledged that many of its budget reduction proposals in March 2016 were unrealistic. The panel also found that the council had “insufficient understanding and ownership” of its spending plan and a lack of clear ideas to deliver the measures needed to balance the council’s budget, which will now jeopardise its chances of successful reform.

“The council understands that long-term financial stability will be achieved only by delivering a highly ambitious transformation agenda,” wrote J R A Crabtree, BIIP chair.

“If this is to be successful the council must simultaneously make significant savings, invest in new ways of operating and develop an organisational culture that is fit for purpose. Given the scale of the change still required both the political and managerial leadership will have to continue to boost its collective focus, energy and pace to ensure that the changes make a positive difference to the residents of Birmingham.”

The BIIP was appointed by the former local government secretary Sir Eric Pickles to oversee the reform of Birmingham City Council after a review by Sir Bob Kerslake found that the council was not providing good quality services consistently.

While there has been unexpectedly slow progress in changing the council’s organisational culture, the BIIP has recognised the progress made two years into its five-year improvement programme and noted that the local authority’s leader John Clancy, its cabinet members and its CEO Mark Rogers are “actively engaged in joint working to understand and grip the full challenge now facing the council”.

“The panel’s acceptance that the council is actively addressing concerns raised by the Kerslake review and is strengthening how it manages its corporate performance by putting in place improved collaborative working between elected members and officers is welcomed,” Clancy said.

“I am particularly pleased that the panel is fully supportive of my decision to appoint four assistant council leaders who are leading a drive towards greater devolution and developing new ways of involving and listening to the views of citizens.”

Rogers commented that “continuing and profound reductions to local government funding” have made the process of setting a budget increasingly challenging for many councils. However, he acknowledged the difficulties facing the 2017-18 budget and stressed that the council will not lose sight of its responsibilities to improve itself and its adult social care services. 

“Challenge during these times is always welcome, and helps us to focus even harder on delivering the services and support, with partners, for Birmingham citizens,” he said.

Given the pressure that the council now faces, the BIIP has agreed with Birmingham City Council to jointly commission an independent review of its 2017-18 budget. This will have a particular focus on the quality and robustness of the council’s delivery plans for next year.

 (Image: Victoria Square Birmingham at dusk c. Cristian Bortes)

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Comments

Peter Walker   10/11/2016 at 08:38

This entire overspend is less than many "Vanity" projects the public fund for London such as Garden Bridges, Parliament refurbs and renovations that benefit only those who live/work in or by them or pay extortionate tourist rates to enjoy. Cease the public investment in London non-essential public service projects and assist 90% of the country with benefits from the money.

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