Debt-ridden councils in dire straits

THE announcement by Birmingham council last week that it had effectively declared bankruptcy caused uproar in political circles and finger-pointing over who was to blame for the collapse.

But as data journalist David Dubas-Fisher reported for the Mirror this week, almost 100 local authorities in England, including a number in the North, have a higher debt burden than Labour-run Birmingham.

Some 192 local authorities in England have debts that are more than twice the size of their spending power, including Birmingham at 4.4. But that's nothing compared with Woking council, which itself issued a section 114 notice in June and had debts 146.4 times its spending power in 2021/22. In Warrington, the ratio is 9.7, Leeds 4.9, South Tyneside 4.8 and Manchester 3.2.

Jonathan Carr-West, chief executive of the Local Government Information Unit, said the existing funding system "is driving dozens of councils across the country to financial ruin".