City ser­vice heads face ‘star cham­bers’

Birmingham Post - - NEWS - Carl Jack­son Coun­cil Correspondent

BFormer coun­cil leader Sir Al­bert Bore

IRMINGHAM City Coun­cil is be­ing ‘com­pla­cent’ over its sig­nif­i­cant fi­nan­cial fail­ings, for­mer leader Sir Al­bert Bore has warned.

Sir Al­bert ar­gued bosses were too quick to claim the au­thor­ity was suf­fer­ing the same prob­lems as other coun­cils and was ig­nor­ing its own mas­sive over­spends, par­tic­u­larly in waste ser­vices.

It comes as the Labour-led ad­min­is­tra­tion pub­lished its for­mal re­sponse to au­di­tors Grant Thorn­ton which is­sued a rare set of rec­om­men­da­tions after the au­thor­ity used £117 mil­lion of re­serves in two years.

Fi­nance and gov­er­nance di­rec­tor Clive Hea­phy de­clared that the coun­cil faced “chal­leng­ing and un­cer­tain” times and warned ser­vices may have to be axed if con­sid­er­able sav­ings tar­gets of around £120 mil­lion by 2021/22 were to be achieved.

But chair­ing the coun­cil’s re­sources over­view and scru­tiny com­mit­tee on Tues­day, Cllr Bore (Lab, Lady­wood) took is­sue with Mr Hea­phy, point­ing out that the lo­cal govern­ment sec­tor as a whole had suf­fered fund­ing cuts.

Ref­er­enc­ing the re­cent au­dit re­port, Sir Al­bert, who led the coun­cil un­til 2015, said: “They said the key pres­sure point for most met­ro­pol­i­tan au­thor­i­ties is the so­cial care bud­get which is over­whelm­ingly de­mand driven.

“It is rel­a­tively un­usual for key fi­nan­cial chal­lenges to re­late to place-based ser­vices (waste man­age­ment).

“This is an in­di­ca­tion that things have gone badly wrong at Birm­ing­ham in this re­gard.

“I do not be­lieve your re­port to coun­cil ad­dresses the se­ri­ous point the au­di­tors made.

“There is a com­pla­cency al­most that we are part of a prob­lem which ex­ists across lo­cal govern­ment, and yes, I do ac­knowl­edge we are part of a prob­lem that ex­ists across lo­cal govern­ment.

“But the ex­ter­nal au­di­tor is in­di­cat­ing that there are other things go­ing wrong in Birm­ing­ham and we are dif­fer­ent in many re­spects in some of the prob­lems we are ex­pe­ri­enc­ing.”

Last year’s bin strike along with heavy snow con­trib­uted to the waste ser­vice be­ing over­spent by £5.3 mil­lion in 2017/18.

The au­di­tors also high­lighted that the coun­cil’s con­struc­tion and prop­erty ser­vices com­pany Acivico over­shot its bud­get by £9.5 mil­lion dur­ing the same pe­riod.

Cllr Meirion Jenk­ins (Con, Sut­ton Mere Green) echoed Cllr Bore’s sen­ti­ments and ar­gued there was a ‘lack of recog­ni­tion’ of what was re­ally hap­pen­ing. He also ex­pressed par­tic­u­lar con­cerns over Acivico’s trou­bles and said: “Just read­ing this (re­sponse to au­di­tors) it’s got a kind of ‘Yes Min­is­ter’ feel about it, it’s say­ing all the words, it’s go­ing through the mo­tions but I’m not en­tirely con­vinced the se­ri­ous­ness of the sit­u­a­tion has been grasped.”

He added: “The coun­cil as it cur­rently stands, in the cur­rent cul­ture, is never go­ing to be able to op­er­ate com­mer­cial com­pa­nies prof­itably be­cause it just doesn’t have what it takes to do it.”

Mr Hea­phy pointed out that by 2021/22 the coun­cil will have lost three quar­ters of a bil­lion pounds worth of its Govern­ment fund­ing in 11 years – more than 50 per cent of its bud­get.

Yet he main­tained the sav­ings re­quire­ments for the next four years were not ‘in­sur­mount­able’.

He said: “Birm­ing­ham City Coun­cil must ad­dress th­ese is­sues, how­ever dif­fi­cult the de­ci­sions it needs to take to ad­dress them.

“This may in­volve re-de­sign­ing some ser­vices, work­ing in part­ner­ship with other bod­ies to de­liver other ser­vices, re­duc­ing ser­vice lev­els and stop­ping some ser­vices al­to­gether.

“With­out th­ese ac­tions, the coun­cil will con­tinue to eat into its re­serves and find it­self in a fi­nan­cially un­sus­tain­able po­si­tion.” COUN­CIL fi­nance and gov­er­nance di­rec­tor Clive Hea­phy out­lined re­cent mea­sures which had been taken in re­sponse to au­di­tor Grant Thorn­ton’s rec­om­men­da­tions.

They in­clude im­pos­ing ex­tra re­stric­tions around spend­ing re­serves and re­in­stat­ing ‘star cham­bers’ where de­part­ment bosses are re­quired to ex­plain and jus­tify over­spends on their in­di­vid­ual bud­gets.

Mr Hea­phy said this was al­ready pro­duc­ing re­sults, hav­ing re­duced this year’s bud­get over­spend fore­cast from £28 mil­lion to £12 mil­lion in two months.

He stated that fu­ture an­nual bud­gets would be more fo­cused on coun­cil pri­or­i­ties and added: “There is no com­pla­cency on my part.

“The coun­cil can’t con­tinue to spend more than it gets in, full stop. It can’t keep re­ly­ing on re­serves. Re­serves are there for rainy day events.

“They are not there to sup­port on-go­ing pres­sures and prob­lems.”

> For­mer Birm­ing­ham City Coun­cil leader Sir Al­bert Bore

> Clive Hea­phy

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