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22.12.14

Cuts ‘hit Birmingham hardest’ of all core cities

Birmingham City Council will see its spending power cut by the equivalent of £160 per dwelling, the most of any core cities in England, the local authority’s leader has warned.

Following last week’s Local Government Financial Settlement announcement by Kris Hopkins, the already under-pressure authority said its spending power will be reduced by 6% in 2015-16 (£156.77 per dwelling), compared with an average in England of 2.1% (which equates to £47.47).

Although the cut is in line with what the council feared, the speed of the cuts is “seriously hampering” its attempts to plan for the future. It said this forthcoming year is “the most difficult it has had to face so far”.

In response to the settlement, Labour’s Sir Albert Bore, leader of Birmingham City Council, said: “I am extremely disappointed that the government has not responded to Birmingham’s proposal, which had cross-party support, for a fairer approach to the distribution of grant cuts.

“The cuts confirmed today are equivalent to almost £160 per dwelling and the cut is the greatest of all eight core cities in the country. This essentially echoes the warnings we issued when our budget white paper was published.”

That white paper reviewed every aspect of Birmingham’s expenditure for next year, and suggested making more use of its reserves as a transitional arrangement. It now needs to make £117m of savings next year, rising to £338m by 2017-18. This is on top of the £462m it has saved so far.

The local authority, which was told recently by the communities secretary that it had a year to “improve its performance” or face further intervention, added that despite the financial pressure it is intending to provide a further £19.9m per year from 2015–16 for child protection services, in addition to the extra £9m per year already put in place in 2014–15.

Sir Albert said: “These resources will meet the expected increase in needs and allow for the recruitment of more social workers. However, it is clear from the review undertaken by Lord Warner, the appointed Commissioner for Children’s Safeguarding, that this will not be enough to meet the full cost of the children’s services improvement programme over its lifetime to 2017–18. We will continue to discuss with central government the funding of the three-year children’s improvement plan.”

Cllr Steve Eling, deputy leader of neighbouring Sandwell Council, said the funding settlement had hit the areas with the highest deprivation the hardest. “If the government continues to take this much money out of local government, frontline services are going to suffer,” he said.

Another of the country’s core cities, Liverpool, has expressed its dissatisfaction with the latest settlement. Liverpool’s mayor Joe Anderson says the latest local government settlement will inevitably mean more pain for council services – with the city hit more than three times harder than the national average.

The government’s own figures show Liverpool faces a reduction of 5.9%  in ‘spending power’ in 2015-16. Cllr Anderson added: “This latest announcement does not give me any Christmas cheer, but it is hard to know how bad it really is until we have are able to dig into the detail and get behind the smoke and mirrors from Whitehall. 

“I have said before that we are facing the biggest financial challenge ever, and that there is no white charger coming over the hill to save us.”

(Image: c. Steve N)

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