New Delhi: After robbing India of nearly 45 trillion pounds sterling between 1761 and 1947, funding Britain’s prosperity with its largest colony’s 20-odd famines, systematic pauperization, and millions of deaths—six million in Bengal alone in 1943—London’s karma is catching up fast and thick with the United Kingdom of Great Britain.
For, Birmingham, the UK’s second-biggest city after the national capital, has also declared itself bankrupt!
It is the sixth city in the UK to go bankrupt in the last 13 years. Earlier, Hackney (2000), Northamptonshire (2018), Slough (2021), Thurrok and Craydon (2022) and Woking (2023) had declared bankruptcy.
And, this time, underpaid women seem to be taking this revenge upon male chauvinist British society!
This is when Britain currently has an Indian-origin Prime Minister: Rishi Sunak.
The Birmingham City Council, the local government body, has effectively declared itself bankrupt because it doesn’t have enough money to pay £760 million (USD 955 million) in equal pay claims it owes to female government employees who were paid less than men in the past, the media reported on Thursday.
Birmingham residents have been warned “all bets are off” on what services could be cut after the council declared itself effectively bankrupt, The Independent said.
The Labour-run Council might have to shut libraries, lessen the frequency of bin collections, or raise council tax after it issued a section 114 notice – meaning it cannot meet its financial liabilities.
The council has blamed £760 million of equal pay claims, the expenses of a new IT system, and years of funding cuts by successive Tory governments for its financial woes. It has an in-year financial gap in its budget of £87 million.
A council spokesperson said: “Birmingham City Council has issued a 114 notice as part of the plans to meet its financial liabilities relating to equal pay claims and an in-year financial gap within its budget which currently stands in the region of £87 million.”
A section 114 notice means that Birmingham City Council, which is the largest such authority in the UK and Europe, will stop all new spending, with the exception of protecting vulnerable people and statutory services.
Services that could face budget cuts include street cleaning, parks and maintenance, leisure, children’s services that are not social care, libraries, and even the frequency that your bins are collected.
In June, the council revealed it had paid almost £1.1 billion in equal pay claims in the last 10 years after it lost a case at the Supreme Court in which female employees said they were not paid bonuses that were awarded to men on the same pay grade.
The council has a current liability relating to the claims between £650 million to £760 million, accruing at a rate of £5 million to £14 million per month. It said that “Birmingham had £1 billion of funding taken away by successive Conservative governments.”
Shaun Davies, Chair of the Local Government Association (LGA) said: “Councils in England face a funding gap of almost £3 billion over the next two years just to keep services standing still. Councils’ ability to mitigate these stark pressures is being continuously hampered by one-year funding settlements, one-off funding pots, and uncertainty due to repeated delays to funding reforms.
“The government needs to come up with a long-term plan to sufficiently fund local services. This must include greater funding certainty for councils through multi-year settlements and more clarity on financial reform so they can plan effectively.”