Leader warns of councils in the West Midlands ‘fearful’ of going bankrupt in the next two years

Councillor Shaun Davies
Councillor Shaun Davies

Councillor Shaun Davies, the leader of Telford & Wrekin Council told the BBC that he is hearing “every single day” of well run councils having to declare the equivalent of bankruptcy.

Councillor Davies said: “I’m hearing every single day sadly, councils in this region in the West Midlands who are fearful of going bankrupt.

“Big councils, councils that traditionally have been very safe and well managed councils.”

Councillor Davies is also senior vice chair of the Local Government Association. He added that the LGA has projected that next year there will be councils on the edge of bankruptcy, with more the year after.

Following the Chancellors’ Autumn Statement last week where councils have been told they can increase next year’s council tax by 5 per cent, he added: “We are at a point where this country has not every been before where local government, the thing that brings together localities and communities provides some real front line critical services are on the brink of going bankrupt and that is absolutely terrifying for people who rely on those services.”

Councillor Davies said that councils have been told they can increase council taxes by 5 per cent but that would not fill projected black holes of 10 per cent in both of the next two years.

“People will be paying more but getting less,” said Councillor Davies. Telford and Wrekin Council has already committed to increasing bills by much less than five per cent.

Speaking for the Conservative government on the Politics Midlands show on Sunday, Birmingham Northfield MP Gary Sambrook said he thinks the autumn statement had made “on the whole difficult but fair decisions.”

Mr Sambrook said the autumn statement had put the focus on tackling inflation and creating economic growth while at the same time protecting the poorest and the education and health budgets.

He claimed that councils were wasting money and they could tackle that.

Labour MP Preet Gill, Birmingham Edgbaston, disputed that.