Shabana Mahmood MP slams Birmingham City Council funding settlement

Shabana Mahmood MP along with her fellow Labour MPs in Birmingham wrote to the Chancellor of the Exchequer Philip Hammond in November to demand action to reverse the damaging cuts to Birmingham City Council’s budget and called for a “fairer funding deal”.


The MPs wrote:
“The consequences of a £150 million black hole in the City's budget next year are unthinkable".
“Unless the Government acts now, grave damage will be done to the social fabric of Birmingham and Brummies in need of care and support will be let down.”

The letter stated that the effect of cuts imposed since 2010 has created “a shortfall of approximately £150m in the council and NHS next year, risking the closure of Childrens’ Centres, leisure centres, libraries, cutbacks to vital elderly care services, and longer waiting times for vital operations.”

In addition they warned that:
• Social care services face a funding shortfall of £130 million by 2020/21.
• NHS services are set to go between £40 and £50 million over budget next year, despite plans for radical changes to health services which will save money.
• Birmingham will be £98 million a year worse off because cuts in funding have not been distributed fairly, with some councils affected far more than others.

They also pointed out that these cuts came in the face of increased demand for social care partly because the number of elderly people in the city has increased, which is going to cost the council an extra £28 million a year to provide the services needed.

Philip Hammond replied in December that:
‘the government has adopted policies to make it easier for local authorities to plan their spending and raise revenue’ and that in aspects such as social care he is ‘aware of the challenge this may present’. 


The Chancellor’s full reply can be seen on this page.

Shabana Mahmood, responding, said:
“The Chancellor has rightly said that reducing the deficit has required tough decisions. But after more than six years, the Tories’ deficit reduction policy has eminently failed. In 2010 the Tories promised to clear deficit by 2015: in fact it was the central mandate of their election. But in the Autumn Statement Hammond confirmed that the deficit could not be eliminated until up to ten years later, saying that the UK finances would "return to balance as early as is practicable in the next Parliament".


“And the by-product of this failed economic policy and political decision to impose enormous cuts on local government, as we are accustomed to expect under a Tory Government, is that the typical man, woman and child in the street and the most vulnerable are suffering. Since 2010, Birmingham’s youth service has been eviscerated and rough sleeping has quadrupled. Meanwhile the NHS and social crisis care are in crisis.


The Government must urgently rethink their economic and local government funding policies before there is a real crisis in Birmingham’s social fabric”.