Michael Gove confirms commissioners will take over Birmingham City Council
It's after it effectively declared itself bankrupt
Last updated 19th Sep 2023
Michael Gove has announced he will appoint commissioners to take over Birmingham City Council and will launch a local inquiry into the authority after it declared itself effectively bankrupt.
The Communities Secretary said he was "satisfied that Birmingham City Council is failing to comply with its best value duty" after it issued a Section 114 notice.
He added: "In line with the Local Government Act 1999 therefore, I can announce that I am today writing to the council to set out my proposal to intervene and to appoint commissioners and that I intend to launch a local inquiry in due course.
"I do not take these decisions lightly, but it is imperative in order to protect the interests of the residents and taxpayers of Birmingham, and to provide ongoing assurance to the whole local government sector."
Michael Gove told MPs: "The residents and businesses in Birmingham deserve better and the intervention package I'm proposing today is formed of two complementary parts.
"First, I propose to issue statutory directions to the council and to appoint commissioners to exercise certain functions of the council as required.
"And second, I intend to launch a local inquiry to consider the more fundamental questions around how Birmingham got to this position and options for how it can become a sustainable council moving forward that secures best value for its residents.
"I'm proposing a transfer to the commissioners of the exercise of all functions associated with the council's governance and scrutiny of strategic decision making, all functions associated with its financial governance and the scrutiny of its strategic financial decision making, and all functions relating to senior appointments.
"And, as part of the proposed direction, the council would, under the oversight of the commissioners, prepare and agree an improvement plan within six months, which would set out the council's own plans to make the necessary improvements to the whole council to return it to a sustainable financial footing."
Mr Gove said the commissioners will have the power to make decisions directly if needed, adding he is "minded" to implement the package he has set out and the city council has five working days to make representations.
Michael Gove has announced he will appoint commissioners to take over Birmingham City Council and will launch a local inquiry into the authority after it declared itself effectively bankrupt.
The Communities Secretary said he was "satisfied that Birmingham City Council is failing to comply with its best value duty" after it issued a Section 114 notice.
He added: "In line with the Local Government Act 1999 therefore, I can announce that I am today writing to the council to set out my proposal to intervene and to appoint commissioners and that I intend to launch a local inquiry in due course.
"I do not take these decisions lightly, but it is imperative in order to protect the interests of the residents and taxpayers of Birmingham, and to provide ongoing assurance to the whole local government sector."
Responding to the statement made by Rt Hon Michal Gove MP this afternoon, Councillor Paul Tilsley CBE; former deputy leader of the council and former Lord Mayor, commented:
“It’s a self-inflicted injury, by Labour, which causes pain to the people of Birmingham”
“Max Caller, who is going to lead the intervention is a well-respected, local government professional who has already made some pronouncements as far as Birmingham is concerned. He has questioned the level of service that is being provided currently in the city.
“It’s unacceptable that Council Leader Cllr John Cotton received a letter from Mr Gove last month and has to date not responded.
“Birmingham Labour’s cabinet haven’t come up with proposals because they cannot get agreement from Trade Unions, who have held Birmingham City Council to ransom over the equal pay issue for years.
“Cllr John Cotton I’m afraid, has shown weak leadership, and prior to that, Cllr Ian Ward.
“I welcome a local enquiry because it will help us to get to the bottom of the poor culture, weak governance, trade union relations and the churn of senior officers”.
“At the heart of this, and I quote “the Labour group which has been identified as dysfunctional created a dysfunctional climate amongst members.”
“They have been unable to make the decisions that this city has needed.
“If anybody is under any misapprehension as to how serious this situation is, these special measures will last for 5 years. The situation is severe.
“I have been warning for a long time that the financial situation and the policies that were being pursued were unmanageable and essential led to the situation we are in now.
Rhea Wolfson, GMB Union’s Head of Industrial Relations, said:
“For decades Birmingham City Council has broken the law and stolen wages from low-paid women workers.
“The quickest, cheapest and fairest way to get a grip of the crisis in Birmingham is to work with GMB to end the discrimination and compensate the women.
“That’s what GMB has been urging the council to do for almost 2 years, and that’s what we’ll continue to push for because it’s what’s best for Birmingham.”
In response to Secretary of State Michael Gove’s announcement, Birmingham City Council leader Cllr John Cotton said:
“We welcome today's announcement and will now work with DLUHC and the commissioners to get the council back on a sound financial footing.
“On becoming Leader, I was concerned that there was a lack of senior capacity at the council to deal with the issues that we face, which is why we asked Secretary of State Michael Gove and the Local Government Association to help us rebuild that capacity and support us to get the budget on track. Today's announcement is an important step in that direction.
“Although this is a challenging time, and comes after a decade of cuts totalling £1 billion, we will make the tough decisions needed to transform the council, restore financial sustainability, and deliver the services that the people of Birmingham deserve.