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Council faces more strikes as waste staff cuts could be key to ‘lawful budget’

Birmingham residents and council workers could face further strike misery as a row between the authority’s senior management and its waste collection employees shows no sign of slowdown, despite a seemingly mutual agreement having been reached a couple of weeks ago.

In a report presented to the city council’s Cabinet at a meeting late last week, its interim CEO Stella Manzie and corporate director of place, Jacqui Kennedy, emphasised the importance of “operating within the allocated budget and within the council’s policy objectives” – a move that would be impossible without pressing ahead with planned staff redundancies.

The dispute between Unite and Birmingham City Council kicked off in June when the authority announced its intentions to make 106 employees redundant as part of a reorganisation of its waste management service to curtail spending.

After balloting its members on potential action, the union announced in August that the refuse worker strike could continue until Christmas if the decision to axe jobs was not scrapped.

But just a few days later, Unite called off the strike and “hailed victory” after meaningful talks had taken place between the council’s management and the union’s executives at Acas. Birmingham, however, maintained that these talks did not necessarily represent the council’s official position until matters were considered by the Cabinet, with the redundancy package still in place in the meantime.

During the Cabinet meeting last week, councillors considered both a report from the authority’s CEO and a private report that contained more detailed and commercially sensitive information.

In her report, Manzie showed no signs of a shift in position, with the document making clear that the Cabinet should endorse the progression and implementation of the waste management reorganisation and discuss its next stages, “including issuing the redundancy notices to 106 employees currently designated as Grade 3 Leading Hands”.

A decision not to proceed with the proposed shake-up would lead to an increase in costs of £600,000. The delay in implementing the reorganisation, which was originally scheduled to start on 1 July but is now planned for 1 October, will already result in an overspend of £2m.

“Any additional on-going full year financial implications will need to be evaluated and incorporated in the budget for 2018-19,” noted the report. “There are additional costs associated with the contingency plans that have been put in place in response to the industrial action.

“The estimated weekly costs have ranged between £21,000 per week in the early stages of the industrial action in July to the current weekly estimate of £311,000 as external contractors have been mobilised. This will be an additional pressure on the Council’s finances for 2017-18.”

Potential threats to a lawful budget

Manzie also revealed that the “most significant potential financial implications” as a result of not pressing ahead with the staff cuts would arise from a “significant increase in the risks in relation to further equal pay claims”.

Given the low probability of the council “being able to mount an effective defence to such claims”, the CEO explained, meeting these liabilities would “more than wipe out available headroom in the equal pay contingency, any uncommitted sums for capital investment and all available revenue reserves”.

“This would still leave a significant gap which would lead to the need for very significant and urgent reductions in both revenue and capital commitments and would also lead to the statutory chief financial officer having to consider whether the council was in a position to set a lawful and balanced budget,” she warned.

The local authority’s apparently firm commitment with implementing the cuts – especially in light of an alleged lack of alternative proposals put forward by trade union representatives – will likely trigger a return to strike action. Unite has already confirmed that it will not negotiate any further unless the planned redundancies are taken off the table altogether.

“A deal has been reached to end this dispute and to ensure that Birmingham has the effective refuse collection service the second city needs,” a union spokesman said in a statement. “We call on the opposition parties not to undermine the Acas process or the council leadership or to cause further disruption for local people, but to honour this settlement and support the return of the refuse service.”

(Top image c. Andrew Skudder)