The leader of Birmingham City Council has declared that the authority is no longer “bankrupt” after publishing budget proposals that set out a £130 million funding boost for frontline services.
The proposals mark a major milestone for the council, coming almost two‑and‑a‑half years after a Section 114 Notice was issued, which effectively froze non‑essential spending and signalled severe financial distress.
The draft budget for 2026/27 sets out a balanced revenue position, with additional investment focused on improving day‑to‑day services that matter most to residents. Priority areas include:
- Cleaner streets
- Safer neighbourhoods
- Improved local services
The council’s position that it is no longer “bankrupt” is backed by advice from its statutory officers, including the Section 151 Officer and government‑appointed Commissioners overseeing the council’s recovery.
Their support indicates that the authority now has a credible financial plan in place and is operating within a sustainable framework.
Cllr John Cotton, Leader of Birmingham City Council, said:
"The council is no longer under a Section 114 Notice. Thanks to the decisive, tough action we took to get the council back on track, the ‘bankrupt Birmingham’ tag is now a thing of the past.
"This is a significant moment in the council’s recovery and is down to the sheer hard work that has been undertaken here in Birmingham by members and officers, supported by commissioners.
"We are back in the mainstream of local government. We have closed a £300 million budget gap, we’ve tackled our equal pay liabilities, and we are getting to grips with improving the services that the council provides for the residents of Birmingham.
"This is an important milestone in our improvement journey and we will continue to take the difficult decisions required to be the council the people of this city deserve.
“I'm determined that the mistakes of the past will not be repeated, as we drive further efficiencies to deliver better services and value for money for council taxpayers.
"I’m ambitious for Birmingham’s future. Now we will step up our work with West Midlands Mayor Richard Parker and Government to invest in our communities, delivering the homes, jobs and services that the people of this city deserve."
The proposed budget will be formally considered by Cabinet on 10 February, before being debated and voted on by councillors at Full Council on 24 February.
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