Latest Public Sector News

02.04.19

Improvement panel’s final report warns Birmingham City Council’s finances remain ‘immensely serious’

Birmingham City Council’s financial position remains “immensely serious,” a government-commissioned improvement panel had warned.

Despite some improvements, the city council has been hit with three separate auditor warnings in four years, the latest coming last week in wake of the latest set of strike action from bin workers, which has cost the authority a total of £14m.

The independent improvement panel warned that the council’s “denial, defensiveness and push-back about the extent of its problems, risks and challenges” has prevented it from making urgently needed improvements.

The panel has been scrutinising the council’s improvement journey since 2014, but following today’s final report to the government it has now disbanded itself as “we have done all we can within our existing terms of reference.”

The final report was critical of the council’s approach to industrial relations which, following two different sets of industrial action regarding bin workers, it said remains “precarious.”

The panel estimated that the two long-running bin disputes cost an estimated £14m, adding that it believed the council should have achieved far more progress in this area.

It said “the resilience of much of the council’s progress is yet to be tested,” and that it must modernise if it wants to “survive and thrive.”

The panel acknowledged the “meaningful progress” the council had made, and also pointed to the “many significant opportunities” in the future, including the Commonwealth Games 2022.

But despite these “credible efforts,” the report said Birmingham’s financial position “remains immensely serious and the risks to its financial resilience are considerable.”

Last week, the city council received its third auditor warning in three years and was accused of “unprecedented levels of financial incompetence” as it “lurches from crisis to crisis.”

The council proposed £50m worth of cuts in November, and the authority’s leader Ian Ward called it the “most challenging period in Birmingham City Council’s history.”

Responding to the panel’s report, the chief executive of the council Dawn Baxendale said: “This marks the end of a four-year improvement journey for the city council, and we thank the panel for their consistent support.”

She said that “significant progress” has been made but acknowledged that “challenges remain,” with the council stating that it intends to maintain constructive and critical challenge through internal scrutiny.

“My focus is now to work with my officer team and members to make sure that we do not lose the drive around our improvement.”

 

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