The Chamberlain News

Sir Albert Bore cancels Armageddon

A white paper containing Birmingham city council  budget proposals for 2014-15 will map out a £119 million cost cutting plan but stop short of closing down entire town hall services.

Council leader Sir Albert Bore has consistently warned he will have to move to ‘step three’ of his service review – the ‘Armageddon’ option and ‘the end of local government as we know it’ – to deliver the huge scale of savings demanded by the Chancellor.

But in the first sign of scaling back on his Domesday rhetoric, he told a private meeting of Labour councillors that it would not after all be necessary to decommission services next year.

However, Sir Albert, whose Jaws of Doom graph depicts the council’s projected £825 million budget shortfall, explained that scrapping entire tranches of services might have to start in 2015-16 when the savings target is expected to be £154 million.

The white paper brings together a series of green papers setting out how each council department must contribute towards the government’s public sector spending squeeze by delivering a total of £119 million of cuts in 2014-15, on top of £100 million cuts this year.

Most of the emphasis is on reducing service provision, with shorter opening times at libraries, community and sports centres, and transferring some services to the private and voluntary sectors.

A heated two-day Labour group meeting to consider the 2014-15 budget proposals was marked by “row after row”, according to one councillor.

Many of those who attended left before the first six-hour session ended.

There were concerns about the absence of any paperwork setting out in detail Cllr Bore’s proposals for cost-cutting. Councillors were instead shown a powerpoint presentation, but reacted angrily and complained about being unable to read scores of A4-sized slides.

Some councillors accused Sir Albert of reneging on a pledge not to ‘salami slice’ budgets and said that he had failed to deliver on promises to reshape local government for the 21^st century.

The decision not to proceed with decommissioning services at this stage will give Sir Albert a short breathing space until 2015-16 when he is forecasting that spending cuts of £154 million will have to be achieved.

Three unpredictable factors may help the council leader in the meantime.

• Renegotiation of the Service Birmingham/Capita ICT contract could save £43 million.
• The sharing of public sector budgets across Birmingham could transfer upwards of £20 million of NHS money to the council to help fund adult social care.
• An improving economy and falling unemployment may persuade the Chancellor to put the brakes on his austerity programme in 2015-16 to coincide with a General Election.

A discussion about renegotiating the Service Birmingham contract was squeezed into the final session of Saturday’s Labour group meeting, with fewer than 40 councillors present.

It was confirmed that the cost of the contract will in any case fall by £13 million next year when the business transformation project comes to an end. Council bosses believe they may be able to reach agreement to reduce the overall cost of Service Birmingham to about £80 million a year.

An internal debate continues to rage among Labour councillors about the possibility of cancelling the contract with Capita and finding a cheaper ICT provider. Local authority lawyers took care to negotiate a get-out clause when the deal was first signed in 2005, enabling the council to cancel “at will” the contract.

But there is uncertainty about how much compensation the council would have to pay to walk away from the Capita with estimates ranging between £20 million and £40 million.

Sir Albert is set to tell the council’s main scrutiny committee that the white paper will describe a long-term plan “which describes what the future city council will look like and how it will achieve more with less resources”.

In a written report to the committee, Sir Albert set the scene by insisting the council was ready to radically alter the way it delivers services: “The white paper will confirm that the administration is united in opposing the scale and speed of cuts being imposed on our city and our local communities, though this does not mean we are against all change.

“These cuts will mean the end of local government as we know it, but that does not mean the end of local government. We now need to build the new local government that will replace it. We are committed to the outcomes we are trying to achieve, but we are ready to radically alter the ways in which we achieve them.

“It is crucial that the most critical areas of service to the most vulnerable in our community are protected, but we are also determined to make changes that move us in the right direction – towards a city council that will be better at serving the people of Birmingham in the years ahead.

“To do this we need to have a longer term plan which describes what the future city council will look like and how it will achieve more with less resources. So, as well as setting out clearly the steps we propose to take in 2014-15, as agreed through the service review programme, the white paper will also shows how these fit into a longer term approach.”

So the White Paper will put forward a new approach to how we govern the city. At the heart of this plan are radical changes to how we fund local services and the structures through which we operate. The core role of the city council and the functions it needs to perform will be set out.