Birmingham City Council

Baroness Taylor of Stevenage Excerpts

Tuesday 1st April 2025 Lords Chamber

[Baroness Pinnock (LD)]

My Lords, 17,000 tonnes of uncollected household waste creating mountainous heaps of stinking rubbish on the streets of Birmingham is simply unacceptable—particularly in terms of the public health hazard that is created. As a result, and after three weeks of a strike by bin workers, the city has declared a major incident. It is expected that this will allow the council to implement a contingency plan to clear the waste mountain from the streets. So my first question to the Minister is: how confident are the Government that the waste will be cleared before the Easter holidays? Given that this emergency action has been taken because of the growing public health risk, how sure are the Government that diseases caused by a combination of rotting rubbish and rats can be prevented? My third question is: what are the public health risks faced by residents living in those parts of Birmingham where the rubbish mountains are worst?

The very challenging financial strictures facing the city council are of course one cause of this dire situation. The apparent failure to tackle the long-standing equal pay claims from women employed by the council is another contributory factor. Equal pay claims have been a challenge for councils across the country. Some resolve the problem by outsourcing: others, including my own council, resolved the absolutely unfair pay systems over 20 years ago by working with unions to agree a single pay spine and settling women’s claims for lost pay. |If that was 20 years ago, can the Minister explain how it is that, in Birmingham, equal pay claims were allowed to fester for so long?

I raise the significance of equal pay as the council cites it as a fundamental reason for not being able to settle the current dispute. Can the Minister comment on whether Birmingham City Council has finally resolved historic equal pay claims and whether existing pay for all employees is on a fair footing?

It is of course right to acknowledge that Birmingham has had a reduction in its core funding of 40% or more, which has left the spending level per person 19% lower than 14 years ago. In more deprived areas, the loss per person is nearer to 26%, according to a report from the IFS. Clearly, the huge loss of funding has put the council into very difficult circumstances. Eleventh-hour additional funding from the previous Government helped forestall the financial collapse of the city council. As a consequence, very difficult decisions have had to be made. Can the Minister confirm that major change to support council finances is needed and will come?

Finally, it has to be asked whether Birmingham City Council is too large. It serves 1.2 million people, which makes it the largest local government authority in Europe—double the size of the next largest in this country. With just 101 councillors, each one serves over 12,000 people. Can the Minister explain how community representation can occur under these circumstances? The reason for the question is that the different needs and aspirations in a council of that size are hard to meet when elected representation is on that scale. It seems likely to have contributed to the problems now being faced. Does the Minister agree?

Birmingham is a great city. It needs the support of the Government and Opposition in aiding a recovery. I look forward to the questions asked being answered, either now or in writing.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

I thank both the noble Lord and the noble Baroness for their questions. I will elaborate on the Statement a little but, before I do, the tone taken by the noble Lord, Lord Jamieson, showed no acceptance of the 14 years of funding withdrawal from local government. That is at the heart of this problem.

I would like to update the House on the statutory intervention at Birmingham City Council, which was part of the reason for this Statement in the other place, and on issues affecting the waste service, following the Statement made by my honourable friend the Minister for Local Government and English Devolution in the other place yesterday. This Government were elected on a manifesto that pledged to fix the foundations of local government and we have set about doing that with some energy. The public rightly expect and deserve well-functioning local councils that provide the essential statutory services that residents rely on.

Local councils must be fit, they must be legal and they must be decent. Commissioners have been working with Birmingham City Council for the last 18 months to support the council in its recovery. Their latest report on that progress was published by the Government yesterday and lands at a point of acute difficulty for residents in Birmingham. As we know, the ongoing waste dispute is resulting in rubbish piling up in the streets, so I will also take this opportunity to give the latest update on the status of that dispute.

The council has taken important initial steps forward on its improvement journey and is working constructively with commissioners. It has made significant progress in addressing historic equal pay issues and fixing the foundations of its governance. The leader, Councillor Cotton, and his group are taking difficult decisions to get the council back on track. The commissioners have recognised that, and that his calm leadership through stormy waters is definitely moving the council forward. The new managing director, Joanne Roney CBE, has brought a steady hand and is beginning to make permanent senior appointments that will contribute to that much-needed stabilisation. The council has also achieved a breakthrough by achieving an agreement to settle the outstanding claims to end the ongoing equal pay saga. It has also set a reimplementation strategy for the Oracle system, which was part of the issue there.

That improvement is encouraging, but deep challenges remain. In the short term, commissioner oversight and close supervision will still be required to maintain the momentum that has started to build. There is a difficult road ahead on the key aspects of the best value regime—governance and culture, financial management and service delivery—because substantial risks threaten the journey to reform and recovery.

As we all know, there is a live industrial action in waste services involving one of the three unions recognised at the council. The Government will support the leader and his team at Birmingham, directly and through the commissioners, to move the council on from these historic issues. That includes an increase in core spending power of up to 9.8%, or £131 million, for 2025-26, including £39.3 million of new one-off recovery grant, illustrating the Government’s commitment to correcting the unfairness in the funding system; and an “in principle” agreement to the exceptional financial support, totalling £1.24 billion.

The noble Lord, Lord Jamieson, raised the issue of council tax, but actually it was his Government who signed off a 10% council tax increase in Birmingham last year. That was more than the council put up its council tax by this year.

Councils deliver more than 800 services and make a huge difference, but it is accepted that for many, the most visible and universal service is the collection and disposal of household waste. Many noble Lords know that the current industrial action in the city is causing misery and disruption to local residents. I am not going to make light of that; I know how difficult it is for them.

From the outset, we want to be clear that statutory intervention is led by commissioners and Ministers, who cannot legally intervene in the industrial action. The Minister for Local Government and English Devolution has been in regular contact with the leadership of the council throughout as it has sought to find a resolution which, importantly, maintains the reforms needed to build a sustainable council and which also returns waste collection to a normal functioning service. This is causing public health risks to the city’s most vulnerable and deprived and, as a result, yesterday Birmingham declared a major incident to give it the mechanisms to better manage the impact on residents. I support that decision, and this Government will back local leaders to bring the situation back under control in the weeks to come.

The Government will not hesitate to provide support in any way that Birmingham’s leaders need and, as Parliament would expect, a meeting with the leadership of the council, the commissioners and other key local partners is taking place to make sure that we are doing everything we can to protect public health. I spoke to Councillor Cotton myself this afternoon to ask him if there is anything further he wants us to do.

It is in the interests of all parties—and, most importantly, the people at the heart of this, the residents of Birmingham—that the industrial action is brought to a close in a meaningful and sustainable way as soon as possible, and we encourage all parties to redouble their efforts, get round the table and find that resolution. Councillor Cotton confirmed that live negotiations are ongoing; that work is still continuing. To do this, any deal to end industrial action must maintain value for money and ensure a fit-for-purpose waste service, without creating or storing up liabilities for the future. All parties recognise that Birmingham’s waste service has been in urgent need of modernisation for years. Any deal reached must not repeat the mistakes of the past.

Practices in the waste service have been the source of one of the largest equal pay crises in modern UK history, resulting in costs of over £1 billion. This situation simply cannot continue, and that is what needs resolving, and resolving urgently. Our Government will support the council in its journey to creating the sustainable, fair and reliable waste service that the residents of Birmingham deserve. We will support the council to resolve historic issues and to continue to establish the leadership, governance and culture that will transform the services and deliver good-quality public services for the people of Birmingham.

On the noble Lord’s specific questions and his comment about failing to address the issue, there have been consistent meetings and discussions with Birmingham throughout this situation to make sure that we give it any support it needs, but it is right that it should be Birmingham City Council’s decision to enable co-ordination between public sector partners on the ground in Birmingham. That is why it has declared this major incident—to ensure that public safety and health is restored. While the situation in Birmingham is clearly very serious and deteriorating, the declaration of a major incident is a well-established mechanism for ensuring that public sector partners can co-ordinate locally to deliver a resolution.

The noble Lord asked whether COBRA would be convened. COBRA is used for significant crises which require a collective government response, co-ordinated at the centre by the Cabinet Office. We are in regular contact with Birmingham City Council, and local leaders are confident at the moment that they can manage the situation. Should this change, we stand ready to respond to any ask for support.

The noble Lord asked how many bin lorries are active. He will be aware that one of the issues was the blocking, as part of the strike action, of bin lorries’ entrance to and exit from the depot. We are hoping that that can be resolved as the negotiations go forward. I cannot tell him off the top of my head exactly how many bin lorries are able to operate, but I shall come back to him in writing on that.

The noble Baroness asked how confident we are that waste will be cleared before Easter. We all want to see this situation resolved as quickly as possible. I hope that, with the good will of all parties, and given that they are still in negotiations with each other, we will be able to resolve this dispute sooner rather than later.

The noble Lord asked about sending in staff or giving extra money to help clear up the rubbish, and whether we would send in private contractors to do that job. As you all know, I am a firm believer in devolution and in letting local people sort the issues out locally. It is right that the response is led by the area’s key public sector partners. We are in regular contact with those local leaders, and negotiations are still open.

On the issues relating to public health, the director for public health at Birmingham City Council is part of the response, and the impact assessment of the strike is closely monitoring the situation on the ground and will continue to do so. The UK Health Security Agency met with the director for public health yesterday and will remain in close contact to ensure that all parties are well informed.

Issues were raised about equal pay, and of course, the noble Baroness is right to say that we needed to resolve those. They were entrenched and affected some of the female workers in Birmingham enormously. We have to give credit to Birmingham for working its way through what has been a very long and hard process. I have gone through one of these equal pay settlements myself. The trade unions have been involved in resolving most of the issues; this is that last part of that process, and the matter is still outstanding. As I say, we urge everyone concerned to get round the table and resolve this now.

I hope that that has answered all the questions. The noble Baroness asked about the size of the council. We are going through a process with all councils of discussing how we take things forward, but it is important that, at the moment, we leave the commissioners and local leadership in Birmingham to do the work they need to do to turn the council around. That work is progressing well; there is still a lot more to do but a lot has been done already, so I hope we will get to where we need to be.

The noble Baroness also referred, rightly, to funding cuts. Birmingham City Council received the sharpest cuts of any council in the country. Because it is the biggest council in the country, the ripple effect that we all felt in local government from the horrendous hollowing out under the last Government hit Birmingham like a tsunami, so I do not think the Benches opposite have much right to criticise what went on there.

[Lord Jamieson (Con)]

My Lords, I apologise: I failed to declare my interest as a councillor in Central Bedfordshire.

[Lord Snape (Lab)]

My Lords, will my noble friend acknowledge that the seeds of this dispute were sown during the period when the Conservative and Liberal party coalition ran the city of Birmingham? Many of the financial problems facing the city over the years were caused by the Conservative and Liberal Government in power in Westminster. On this dispute, will my noble friend acknowledge that the city council has made a perfectly reasonable offer to the union? Among the solutions put forward by the city were the following: NVQ training for alternative work for those affected by the dispute; voluntary redundancy on enhanced terms for those who decline to accept the new terms; six months’ pay protection for the 17 people directly affected by the council’s proposals; fully funded LGV driving training with a guaranteed role at the end for any staff who wish to take it up; and a one-off payment, as an alternative to redundancy, to buy out contracted entitlements. Does my noble friend agree that these are fair and reasonable terms that the union concerned should accept, and that it should reflect on the damage being done to its fellow citizens as well as to the image of Britain’s second city?

[Baroness Taylor of Stevenage (Lab)]

My noble friend is quite right; Birmingham is a proud city with proud people, and I know that they are embarrassed at what they are seeing. It is time that this is resolved. The vast majority of the workforce of the waste service have agreed a way forward by one route or another, whether that is taking voluntary redundancy, accepting new ways of working or many of the other routes that my noble friend mentioned. This now comes down to a small number of people who have not accepted them. That is where the dispute lies. A city such as Birmingham cannot grind to a halt in such a circumstance. We urge everybody to get back around the table and resolve the issues for this small number of remaining members of the workforce, and then we can restore Birmingham to the rightful place it holds as our second city and the pride of the Midlands.

[Lord Fowler (CB)]

My Lords, I declare an interest as having been a Member of Parliament for a Birmingham constituency—Sutton Coldfield—for 27 years, so I know a little about the area.

I am not sure that I agree with the Minister or my noble friend Lord Snape—he used to be my pair, so I call him my noble friend just to keep in with old things. I am not sure they can simply ride away from this and say that the origins of this and the problem are all down to the last Conservative Government. That argument does not stand up. The real problem we need to tackle is not in going back. We have an instant problem now in Birmingham. As we all know, we have the problem of the streets and the rest. We need most urgently to find a solution to that, not to go into all the details over years and years.

Two points come out of this debate. First, surely the Government have a prime responsibility to preserve public health. That has not happened over the last month. They have failed dismally in that duty, not to this House or the House of Commons but to the citizens of Birmingham. They have let them down, and we are still to find out the final result of that negligence. The Government are now saying, as they should, whether they agree with the action of the pickets in stopping trucks removing the mounds of rubbish that have scarred the city and attracted rats and other vermin —we have not imagined this; it is an actuality—and that kind of action and that kind of defeat cannot be justified to the public. The people stopping the lorries are causing immense damage to individuals.

The people who matter most in this are the citizens of Birmingham, and they have been let down. That is the fact of the matter. The Minister should be turning her mind to how the Government will urgently help to get this straight. It is not a matter of having committees and long discussions. We now need urgency and urgent action. I hope the Minister can tell us of some of that.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I certainly agree that the people of Birmingham are at the heart of this issue. They are first in our thoughts. I agree that urgent action is necessary. That is why I spoke with the leader of Birmingham City Council today to see whether there was anything further we could do to support them. He believes that the way to resolve this is to get around the table as quickly as possible, and that is just what he aims to do.

On the noble Lord’s comments on how the situation arose in the first place, there had been serious financial and governance failings. Birmingham City Council issued a Section 114 notice, which effectively says that the council does not have control of its finances, in September 2023. It did so due to accepting a £760 million liability that arose from those equal pay claims, along with in-year budget deficits that arose from the Oracle IT system. It has been working through a very intense programme of activity to put those issues right. It has not been easy for the leadership of Birmingham City Council; nobody goes into local government to cut services or make things less easy for their residents. It has been doing that with the commissioners, who are working very well with the council and have produced a frank and honest report. There is a copy in the Library if any noble Lord wants to look at it. I agree that preserving public health is vital. That is why the director of public health in Birmingham and the UK Health Security Agency regularly review what is going on there, to make sure that everything is done that can be to ensure that the public health situation does not deteriorate any further.

[Lord Shipley (LD)]

My Lords, the Minister has referred to serious financial failings in Birmingham, and the Statement admits that:

“Practices in the waste service have been the source of one of the largest equal pay crises in modern UK history, resulting in costs of over £1 billion to the residents of Birmingham. This situation simply cannot continue”.


Does the Minister agree that this situation might not have arisen had it not been for the abolition, just over a decade ago, of the Audit Commission, which had a role in delivering best value as well as formal audit responsibilities? Taking Birmingham as an example, might the Government consider whether that decision was wise and whether something needs to be done to improve long-term audit of local authorities in England?

--- Later in debate ---

[Baroness Taylor of Stevenage (Lab)]

I absolutely agree with the premise of the noble Lord’s question. The audit situation right across local government, not just in Birmingham, has deteriorated beyond what should be tenable. The audit function assures the public in an area that their council is what I described: legal, decent and fit for purpose. Unfortunately, due to the changes to the audit regime, that is not the case. I was horrified to find that whole of government accounts have been qualified because of a lack of assurance on the local government audit situation. We cannot allow that to continue. The Government are looking at what we need to do about audit. We will bring forward something in the English devolution Bill that covers the audit regime, and we will attempt to make it better than it is now. It is so important that the public can have confidence in the money spent not just by their Government but by local government as well. We will aim to make sure that that is the case. It has been a bee in my bonnet for a long time, and I hope to put it right.

[Baroness Bennett of Manor Castle (GP)]

My Lords, in responding to Front-Bench questions, the Minister said that councils must “provide essential statutory services”. One of those statutory duties for councils, under the Public Libraries and Museums Act 1964, is to provide a comprehensive and efficient library service. Birmingham Council is planning to slash library opening hours, cutting them by a third and potentially closing seven libraries in a city where 46% of children are living in poverty and 43% of residents live in neighbourhoods that are part of the poorest 10% in the country. People need libraries for children to do their homework, old people to go somewhere warm and for everyone to access digital services. Does the Minister believe that, with these new cuts to libraries, Birmingham is going to meet its statutory responsibilities, given that it is actually under central government supervision?

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness will know of my fondness for libraries, because I am sure she has heard me talk about them before in the Chamber. As I said earlier, nobody stands for election as a councillor to cut any services, particularly libraries, which we know are so important to people.

It is important for residents of Birmingham that their council gets back on a safe and stable financial footing. I add that the potential of Birmingham to contribute to the growth mission and regeneration is enormous. Once the commissioners working with the leadership of the council have stabilised the finances, it will be able to support services. I am very pleased that it has not actually cut all its libraries, as we have seen in some other areas, as the noble Baroness will be very well aware, but the closure of any library is a sadness. Once our Birmingham colleagues have stabilised the finances—and with the growth agenda that they will be able to participate in—I am sure that they will want to restore that service as soon as they can.

We should not underestimate the importance of libraries. I practically grew up in my mobile library; it was a great comfort to me. They are important for all the reasons that the noble Baroness said. I hope that Birmingham will be able to restore them as quickly as possible.

[Lord Scriven (LD)]

My Lords, the Minister quite rightly talks about the second report of the commissioners, which was published yesterday. There is a very telling paragraph that the House needs to be aware of, and I would like to hear the Minister’s response to it. It says that

“the Council, currently, still lacks the ability and self-awareness to deliver timely, sustainable reform at the pace required without substantial support and direction”.

In the light of that, the Minister’s response of “leave the commissioners alone” does not stand up. The commissioners are saying that further substantial reform is required. What substantial reform and extra support are the Government now thinking of? What is the timescale for that, in the light of the commissioners saying that it is required?

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord for his question. I think the commissioners are referring to the fact that each time a report is due, the Government can consider whether it is time to take the commissioners’ support out. The commissioners were trying to indicate that they do not feel that the council is ready for their support to be withdrawn at this stage.

The report highlights the progress made by the council so far. It notes the leadership of Councillor Cotton and Joanne Roney, and the hard work of many diligent members of staff in the council. In the circumstance we find ourselves in with Birmingham, that can often be overlooked. Many of the staff there are working tirelessly to make sure that the council delivers for its residents.

The report also sets out that the journey to recovery and financial stability is far from over, as the noble Lord says, and has been heavily dependent on the input, guidance and advice of the commissioner team so far. The indication in the line that the noble Lord quoted is that the council continues to need that commissioner support. We agree with that as a Government, and we will continue to support the leader and his team in Birmingham directly and through the commissioners to move the council on from the historical issues with a fair resolution. The way to do this is to continue on the journey that the council is on and make sure that they all stabilise the council so that it will be able to deliver for its residents long into the future.

[Lord Sahota (Lab)]

My Lords, I declare that I am a member of Unite the Union. I urge my fellow brothers and sisters to keep on talking.

Under the previous Government, many councils of all colours went bankrupt, including Birmingham Council. The root cause of all this was the historical underfunding by the previous Government, as the noble Lord has pointed out, for the past 14 years. Is the historical underfunding of Birmingham Council still the problem there?

[Baroness Taylor of Stevenage (Lab)]

I thank my noble friend for his question. Like many noble Lords in this House, he has direct experience of leading a council, so he has felt the pain of funding cuts, as have all of us who have been in that position. We have made some changes to the local government funding formula this year to make sure that funding goes where it is needed most, instead of following a historical pattern of allocations. We will make further changes to that. As noble Lords will be aware, we are going into the spending review process now, which is why we could issue only one-year settlements, but we will provide multiyear funding settlements, which will make a difference to the stability for local government funding and make sure that the greater quantum of funding goes to the areas where it is most needed, of which Birmingham is certainly one.

[Lord Lucas (Con)]

My Lords, I am very pleased to hear what the Minister said about restoring audit, because the best value commissioners’ report is an astonishing catalogue of failures in governance and culture—deep rooted, long term and all pervasive. What systems does the Minister envisage to allow the new unitaries that the Government are creating to start out with strong cultures and governance, rather than fall into the despairing place that Birmingham finds itself?

[Baroness Taylor of Stevenage (Lab)]

I described my commitment to audit in an answer to an earlier question. Audit is part of that, and so is the collaboration that local government is now pulling together to drive the route towards these new unitary authorities, which will serve them well as they go through the process. We absolutely have to make sure that audit function is in place and sound, because that is the public’s reassurance that their council is not only financially stable but making good use of public money. That is why it should be considered as part of the English devolution Bill.

[Lord Spellar (Lab)]

My Lords, I take my noble friend back to the comments of my noble friend Lord Snape—who, like me, represented the Borough of Sandwell—and the root cause of this problem: the failure of the Conservative/Lib Dem alliance running Birmingham City Council to deal with the equal pay issue. Sandwell Council borrowed the money from central government, paid it back within seven years and resolved the problem. That is the fundamental root, and my noble friend may wish to remind the Opposition Benches of that. With regard to picketing at the depots, has she had the opportunity to remind the chief constable of the West Midlands of the code of practice under the trade union and labour relations Act for the conduct of picketing, and is she satisfied that West Midlands Police are enforcing the law?

[Baroness Taylor of Stevenage (Lab)]

I am grateful to my noble friend for that reminder that there is not a one-party state in Birmingham; other councils have been involved in failing to tackle the equal pay issue over many years. He is quite right to say that for most councils this was a very thorny issue. It came with a great deal of negotiation needed, and quite often with a huge price tag attached. So I do not underestimate the difficulty in dealing with it, but many other councils bit the bullet and got on with it. That was not tackled in Birmingham.

I have not had any conversations with the chief constable of West Midlands Police, but I am sure that the declaration of the major incident will make sure that all agencies in Birmingham are brought in to help support the council and the commissioners and to help to restore what we all want to see: the people of Birmingham being able to get their pride in their city back, and the commissioners and the leadership of the council being able to continue to move Birmingham forward to be the city we all know it can be for the future, right at the heart of the Midlands, delivering growth for the country and being the kind of wonderful place that it is for the people of Birmingham to continue to live in.