Bankruptcy at Labour-run Birmingham Council cannot be blamed on Government funding cuts, a leaked internal report for the party has found.
Sir Keir Starmer today tried to blame ministers for the collapse of Labour’s flagship council, saying it had been ‘stripped of funding’.
But a report ordered by Labour’s ruling National Executive Committee warned the party leadership that blaming the council’s woes on budget cuts ‘does not stand up to scrutiny’.
The report uncovered a ‘dysfunctional climate’ at the council, which has been run by Labour since 2012. It said the authority suffered from a ‘long-standing and persistent issues in getting the basics right’.
Rishi Sunak today said that Labour’s mismanagement of Birmingham demonstrated what the party would do in power.
John Cotton, who was handpicked as Birmingham City Council leader by Labour leader Sir Keir Starmer, conducted an interview via video link on Tuesday as it was announced that a section 114 notice had been filed, effectively declaring the council bankrupt
Sir Keir Starmer today tried to blame ministers for the collapse of Labour’s flagship council, saying it had been ‘stripped of funding’
He said Labour in Birmingham were ‘failing hardworking people, losing control of taxpayers money, and driving their finances into the ground’.
The Prime Minister told MPs: ‘They’ve bankrupted Birmingham, we can’t let them bankrupt Britain.’
The row came as it emerged that the council’s Labour leader has continued with a family holiday in New York – where he is celebrating his 50th birthday – as the crisis unfolded.
John Cotton, who was handpicked for the role by Sir Keir, conducted an interview via video link on Tuesday as it was announced that a section 114 notice had been filed, effectively declaring the council bankrupt.
Speaking to BBC Radio West Midlands by video-link against a blank backdrop, Mr Cotton said the council would ‘continue to deliver on essential services’ for the city’s 1.1million taxpayers.
A local Tory source said Mr Cotton was known to be in New York celebrating his 50th birthday.
Asked whether that was the case, a council spokesman said: ‘Councillor Cotton is away on a long-standing family engagement but has been working around the clock since the Section 114 Notice was published.’ Gary Sambrook, Conservative MP for Birmingham Northfield, said: ‘If anyone wants to see how Labour would behave in Government then look no further than Birmingham.
‘Starmer’s man was picked without a vote and when things get tough is nowhere to be seen.
‘Labour have bankrupted Birmingham and they’ll do the same to the country.’
The financial collapse of Labour’s flagship council, which is the biggest local authority in Western Europe, is a major embarrassment for Sir Keir.
Asked about the issue today, the Labour leader tried to blame the government.
Bankruptcy at Labour-run Birmingham Council cannot be blamed on Government funding cuts, a leaked internal report for the party has found
He told BBC Breakfast: ‘If you take a step back from Birmingham, you will see there are versions of this across the country.
‘And that’s because, for 13 years, local authorities have been stripped of the funding they need.’
But the internal Labour report, which was sent to the party leadership in May, found this was not true.
‘Budget cuts and the size of the City are used as reasons to explain the situation however, this does not hold up to scrutiny,’ the report said.
‘Other large Local Authorities with similar levels of deprivation and inequality have also suffered large, in some cases greater, cuts without the same issues with basic services.’
The study found the council had suffered from ‘years of personality-driven factionalism’, with senior figures leaking damaging stories against each other. It also reported accusations of racism and misogyny.
‘It is clear that the existing culture and processes have contributed to a dysfunctional climate,’ the report said.
Birmingham Council has been plagued by bitter industrial disputes over bin collections and care homes leading to ‘fractious’ relationships with unionised staff.
The report’s authors said that the quality of service delivery was beyond its remit, but added: ‘We cannot ignore the repeated complaints we heard about housing repairs, waste collection and fly-tipping, the bereavement service, and special education.’