A Labour-run council has effectively declared bankruptcy, leading to mockery from Conservative MPs who are equating it with the way a Labour government would run the UK – wrongly.

Yes, Birmingham City Council has issued a section 114 notice, confirming that all new spending, with the exception of protecting vulnerable people and statutory services, must stop immediately – after receiving a £760m bill to settle equal pay claims.

It comes after a Supreme Court ruling back in 2012 found in favour of mostly female employees of Birmingham City Council – and that a bonus scheme that was handed out to staff in certain roles favoured those which were mainly taken up by men.

The Tories caused the problem that led to Birmingham Council’s woes

But here’s the kicker: the court ruling relates to people who were working at the council from 2004 to 2010 – when it was not controlled by Labour. Indeed, records show that in 2004 – the year from which claims could be made, the council was run by the Conservative Party, in coalition with the Liberal Democrats.

For most of the period covered by the court ruling, the council was under no overall control.

The plot thickens

When the council originally lost its Supreme Court appeal, back in 2012, it had been ordered to save £600 million by 2017 – by the Conservative/Liberal Democrat Coalition government.

It could afford to borrow £429 million of the £757 million it was expecting to have to pay – but would have to get special dispensation from the government of the day to take out any more loans.

It seems likely that no such dispensation was forthcoming. This would indicate that it is not Labour, but the Conservatives, who are responsible for Birmingham Council’s precarious financial position.

So when MPs like Richard Holden, below, took to the social media to say things like

he was wrong. The council has been bankrupted by his own party (with help from the Liberal Democrats). Or so it seems to This Writer.

Some Tories, like Simon Clarke (below), have claimed that Birmingham is just one of many Labour-run councils that are now bankrupt. But this is to deny that Conservative-run councils are also out of money, as the context box indicates:

The vast majority of local authority funding comes from central government in the form of the Aggregate External Grant (AEG). It is this money that pays for the vast majority of council services.

The government of the day determines the amount to be given to each council.

This means that, if any council is struggling to provide services, it is likely to be because the Westminster government has not provided enough AEG funding.

So, again, it seems the Conservative government – not individual councils, no matter what the colour of their ruling political group – is responsible if any councils are in danger of financial collapse.

Vox Political needs your help!
If you want to support this site
(but don’t want to give your money to advertisers)
you can make a one-off donation here:

Be among the first to know what’s going on! Here are the ways to manage it:

1) Register with us by clicking on ‘Subscribe’ (in the right margin). You can then receive notifications of every new article that is posted here.

2) Follow VP on Twitter @VoxPolitical

3) Like the Facebook page at https://www.facebook.com/VoxPolitical/

Join the Vox Political Facebook page.

4) You could even make Vox Political your homepage at http://voxpoliticalonline.com

5) Join the uPopulus group at https://upopulus.com/groups/vox-political/

6) Join the MeWe page at https://mewe.com/p-front/voxpolitical

7) Feel free to comment!

And do share with your family and friends – so they don’t miss out!

If you have appreciated this article, don’t forget to share it using the buttons at the bottom of this page. Politics is about everybody – so let’s try to get everybody involved!

Buy Vox Political books so we can continue
fighting for the facts.

The Livingstone Presumption is now available
in either print or eBook format here:

Health Warning: Government! is now available
in either print or eBook format here:

The first collection, Strong Words and Hard Times,
is still available in either print or eBook format here: