Choose-led inquiry to be launched at metropolis council with £760m equal pay invoice
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urope’s largest native authority is to launch a judge-led inquiry to find out who’s accountable for it accruing an equal pay invoice value as much as £760 million.
Birmingham City Council estimated that it had an equal pay legal responsibility of between £650 million and £760 million as of March 31 this yr, which was rising by between £5 million and £14 million a month.
The Labour-led council has already paid out £1.1 billion in equal pay settlements after a ruling by the Supreme Court in 2012, however has now been pressured to implement “mandatory spending restrictions” which can see “non-essential spending” ended instantly.
The council additionally stated on Wednesday that it’ll launch the judge-led inquiry to know the causes of the equal pay invoice and who’s accountable, which is about to start in 2024.
We will likely be open and clear all through this course of and the unbiased opinions and judge-led inquiry will guarantee that there’s correct accountability for these failings.
Councillor John Cotton, chief of the council, stated: “I’ve been clear from day one that I will take whatever action is needed to address the substantial challenges facing the council and these measures are essential to grip the situation – particularly in terms of financial controls, organisational capacity and improved governance.
“We will be open and transparent throughout this process and the independent reviews and judge-led inquiry will ensure that there is proper accountability for these failings.”
Cllr Sharon Thompson, deputy chief of the council, stated the invoice was “one of the biggest challenges this council has ever faced”, however added the council will do “everything we can to protect the services our residents rely on”.
The council stated on June 28 that it couldn’t afford to pay the excellent legal responsibility from current funds and reserves, with its whole income finances for all providers yearly standing at round £750 million.
It apologised for its failings however stated it might imply “there will be significantly fewer resources available in the future” because it re-prioritised spending.
The judge-led inquiry will start following the conclusion of a separate governance evaluate, which was additionally introduced on Wednesday.
The evaluate, to be launched this week, will likely be independently chaired and can deal with failures within the implementation of the council’s new IT system, Oracle ERP.
The BBC reported that the system was launched to assist modernise and pace up cost, HR and different inside processes.
But errors in its implementation left the council with one other invoice to repair the system, estimated to be at round £100 million in response to a council report, of which £46.53 million has been requested for this yr.
The BBC additionally stated in June that the errors led to a number of transactions needing to be handled manually, making a backlog which meant accounts for 2022/23 couldn’t be closed and one faculty was even visited by bailiffs.
Speaking following the announcement of the evaluate, Cllr Robert Alden, chief of the opposition and Birmingham Local Conservatives, stated: “News that even more external support is needed, after a decade of help propping up this failing Labour administration, shows just how incapable the Labour administration is now seen as across the country.
“It is clear that these Labour cuts are just the start and thanks to the Labour cabinet failing to do their jobs properly, residents are in for years of suffering as Labour slash vital services to pay their debt off.”