Birmingham city council declared bankruptcy. UK's second-largest city's situation explained
Birmingham's city council on 5 September, declared itself bankrupt, putting a pause on all spending except essential ones. The Birmingham city council issued a 114 notice last Tuesday, thereby joining a string of local authorities, which include Woking, Croydon, and Thurrock, that have announced it did not have the resources to balance its books, the United Kingdom that is now living “hand to mouth". So far the Conservative party Prime Minister Rishi Sunak-led government has refused to come to the Birmingham City Council's rescue.
The government had already provided extra funding for the council, at around 10 percent of its budget, but ''it's for locally elected councils to manage their own budgets,'' Prime Minister Rishi Sunak's spokesman Max Blain told reporters. A Section 114 notice is issued by a city council when it believes its income will not be able to meet spending. Thurrock, Croydon, Slough, Woking, and Northamptonshire have all issued Section 114 notices in recent years.
The notice means all but essential spending will be halted, in order to protect core services. -Most local reports have put blame of bankruptcy o for England's second largest city on demands of equal pay by the female residents of the city. The Labour-led council in Birmingham had estimated in July that equal pay claims brought by its female staff could cost it up to £760m (over ₹78 Billion).
In June, the council revealed it had paid out 1.1 billion pounds to female workers but still had a current liability of 650-750 million pounds, accruing at a rate of 5 million pounds to 14 million pounds a month. -According to Daily Mail, Birmingham city council spent millions on a ‘botched IT system’ by Oracle. The IT system was supposed to cost 19
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