'Bankrupt' Labour council makes shocking admission about even bigger debt mountain
The authority has already hit locals with a massive 21 percent council tax hike over two years.
Beleaguered Birmingham City Council have admitted they have to make a further £79 million in savings in the next financial year in a "shockingly grim" report.
The authority, which is the largest in Europe, has been tackling a huge mountain of debt and has already told residents of the UK's second-biggest city they face a 21 percent hike in council tax over two years.
At the same time as asking people to pay more, the Labour-run administration also said it would have to cut £300 million from services and sell off £750 million in assets before April 2026.
The council was already forced to issue a Section 114 notice in September 2023, meaning it was 'bankrupt'.
Now according to the BBC a written report by the council's head of financial planning has found a further budget gap meaning “significant work to identify savings” has to be done before the year covering 2025 into 2026.
The biggest previously un-forecast hike in spending comes from the Birmingham Children's Trust (BCT), which said it needed an extra £34.7 million to support vulnerable children with complex needs.
Don't miss... Huge £8m bridge on major UK motorway and why no one pays to drive across it [REPORT ]
BirminghamLive reports during the council cabinet meeting discussing the report, Liberal Democrat Cllr Roger Harmer, said: “This really is a shockingly grim report that implies far more misery for our residents in the next financial year and beyond than even that forecast when we set the budget in March.
"We need to get all departments of this council actually making realistic, sensible forecasts in line with things that are nationally predictable.
“Otherwise we’re going to struggle to actually put in the balanced budget that we need for our residents".
Robert Alden, leader of the Conservatives at the council, added it was “difficult to understate how bad the situation is” for both the council and therefore residents.
Don't miss...
Labour council with energy bills 60 percent higher than Ofgem price cap average [REPORT ]
The pretty little UK town set to become home to an incredible US theme park [REVEAL ]
Furious pensioners left with overflowing rubbish as their bins were 'too big' [REPORT ]
Cllr Mick Brown, the cabinet member for children, young people and families, said Birmingham Children’s Trust was embarking on a major transformation programme.
John Cotton, leader of the council, said they were “under no illusions” when it came to the serious financial issues facing the local authority. “We’ve been asking questions around the strength of forecasting.
“It’s a reflection that the pressures that are manifesting, not just in this council but elsewhere, continue to be severe".
