In an unexpected turn of events, Birmingham, the second-largest city in Britain, risks bankruptcy, highlighting the dangers of poorly planned development. Birmingham, the lively centre of the Midlands, is now at a crossroads of economic unrest. This formerly flourishing city, which is only slightly smaller than London, has declared bankruptcy. However, the question on everyone’s mind is: Why has this historic city, with its rich industrial history and cultural legacy, fallen into such severe straits and declared itself bankrupt?
The city currently anticipates an 87 million pound shortfall for the fiscal year 2023–2024.
Get to Know About Section-114
According to the Guardian, the Labour-controlled administration of the second-largest city in the UK issued a 114 notice, stopping all but necessary spending and becoming the latest council to experience financial trouble. When a council thinks its income won’t be enough to cover expenses, it will issue a Section 114 notice. In the most recent years, Section 114 notifications have been issued in Croydon, Slough, Thurrock, and the last one is Northamptonshire.
Equal Pay Disputation in Birmingham
According to the BBC, a crew of 170 women who worked as classroom assistants, housekeepers, and caterers obtained the right to pursue equal pay lawsuits against the council in 2012. They alleged the council did not give them the same advantages and compensation as males performing comparable employment.
Service Delivery Managed by Birmingham City Council
The Birmingham City Council must now prioritise core services while cutting funds to other citywide services. Checkout below which services are offered and presented by Birmingham City:
- Service for educational purposes for adults
- Services for older adults
- Parks, recreation, and health
- Encouraging healthy lifestyles
- Birmingham’s community and voluntary health care services
How did Birmingham City Council Get to Be Insolvent?
“The Council doesn’t have the resources to cover the equal pay expense and, at this time, has no other way to cover this liability.” The notice requires an immediate halt to all future expenditure, except safeguarding vulnerable individuals and providing statutory services, the Birmingham City Council stated in a statement.
Birmingham is going bankrupt because it owes nearly $955 million to female public workers who were paid less than their male colleagues for years. The City Council just doesn’t have enough money to pay these equal pay claims. In June, they said they’ve already paid 1.1 billion pounds to female workers, but they still owe around 650-750 million pounds. And this debt is growing by 5-14 million pounds every month. That’s a big problem for the city’s finances.
