Five ways Brummies could be hit by Birmingham council crisis amid £50m bombshell

Birmingham was hit with a bombshell last week after it emerged the city council needed to find a further £50m in ‘savings’. Every community in Brum has already felt the shock waves of the council’s financial crisis, with an unprecedented range of services affected.

Libraries, bin collections, day care centres, youth services, arts and culture, street lights – the list goes on when it comes to areas of city life that have been affected. And now, in a briefing to the council’s cabinet this week (Tuesday, July 23), finance director Fiona Greenway warned that the “savings” needed for next year are being increased even further.

As the report points out, the budget gap for 2025/26 was initially estimated at £143.7m. In March, the city council approved a huge range of proposed service cuts and changes for both this year and next year, while also working to find additional savings to cover next year’s gap .

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However, alarmingly, the report bleakly states that “additional pressures of £50.8m have been notified” since this month, partly driven by the costs of supporting vulnerable children with increasingly complex needs . “This means that significant work is still needed to identify further savings,” it warns, adding that £74.7m – £79.2m still needs to be found to now close the 2025 budget gap/ 26.

“The council’s financial position continues to be a significant concern for the council’s corporate leadership team (CLT), cabinet and commissioners,” the report continues. “This increase in the savings target for the 2025/26 financial year only makes the challenge more difficult.”

The commissioners, sent in by the government to oversee the council’s turnaround, added: “The deteriorating financial position is a massive problem for the council that needs a response. The Council should build on the principles in this report and adjust the current plan and approach.

“This needs to be completed by early August.”

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Chief financial officer Fiona Greenway also addressed a health and well-being board last week, saying: “(The report) shows a bigger gap but it shows that we have found quite a significant amount of savings over that period as well. It’s still a really challenging and difficult time to go through.”

The council also discussed how Birmingham City Council’s (BCC) savings plans could potentially impact on the health and wellbeing of Brummies – here’s a look at five ways it could happen.

1) Children and families

A presentation, published ahead of the board meeting, warned: “Changes to the Children and Young People’s Travel Service may impact on families living in poverty due to reduced support provision. “They may have less stamina and resources to make the changes that will be needed.”

It went on to say that “whole system working in an integrated way to understand the impact on services and on children, young people and families is in place to mitigate the impact where possible”.

2) Community Safety Team

The presentation said of the proposals to change the community safety team: “Crime and anti-social behavior impacts on the quality of life and well-being for anyone who experiences it. A possible reduction in the number of teams may mean that there is the potential for more residents to be concerned or adversely affected by crime/anti-social behaviour.”

Speaking about the city’s operations, the council’s Chris Jordan told the meeting: “We are one of the services that has made a transformational contribution in terms of public health resources to change the way we deliver services. This is equally applicable to community safety, where this is a resource that comes in to support this transformation.”

3) Cultural projects

According to the presentation, participation in “cultural activity” is known to have beneficial effects on health and well-being – particularly improving mental health. “The BCC would normally fund around 25-30 projects each year, delivered by small-scale arts organisations,” it continues.

“A cut in funding can have a negative impact on mental health and wellbeing.” Speaking about the cultural cuts earlier this year, council leader John Cotton said: “In an ideal world I would prefer not to be in this position, but we are having to cut our cloth accordingly.

“I think there are conversations we need to have about how we work together as a whole city, not just the city council, to protect and support some of our cultural institutions.”

4) Active Wellbeing Society

The Active Wellbeing Society currently provides more than 1,300 outdoor activities a year – but this could drop significantly due to council plans to cut the grant by 75%. The presentation says that fewer activities of this nature can have a negative impact on well-being as there will be fewer opportunities for physical activity and social interaction.

5) City housing

Another potential impact is fewer staff resources to respond to requests for homelessness prevention and support. However, the presentation notes that mitigating factors are a redesign of the service and partnerships.

Issues specific to Birmingham, such as an equal pay fiasco and the disastrous implementation of a new IT and finance system, as well as increasing demand for services and funding cuts, all played a part in the council’s financial problems. In the past, Cllr Cotton has pointed the finger at the previous Conservative government and argued that many councils were facing higher costs but smaller budgets.

Meanwhile, Tory politicians such as former prime minister Rishi Sunak were quick to point out the mistakes made by the Labor council administration. The BCC’s improvement and turnaround plan, published earlier this year, gave an insight into how it plans to undergo a “fundamental reset” and become a “smaller and leaner” organization in a bid to change fortune

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