With permission, Madam Deputy Speaker, I would like to update the House on the statutory intervention at Birmingham city council and on the issues affecting the waste service.
This Government were elected on a manifesto that pledged to fix the foundations of local government. 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, legal and decent. Commissioners have been working with Birmingham city council for the past 18 months to support it in its recovery, and today I am publishing their latest report into the progress on that journey. The report lands at a point of acute difficulty for residents in Birmingham, as the ongoing dispute in the waste service is resulting in rubbish piling up in the streets. I will therefore take this opportunity to update the House on the status of that dispute.
To address the report first, the council has taken important initial steps forward on its improvement journey, and is working constructively with commissioners. It has made significant progress on addressing historical equal pay issues and fixing the foundations of governance. The leader, Councillor Cotton, and his group are taking the difficult decisions to get the council back on track, and the commissioners have recognised his calm leadership through stormy waters. The new managing director, Joanne Roney CBE, has brought a steady hand, and is beginning to make permanent senior appointments that will contribute to much-needed stabilisation. The council has also achieved a breakthrough by reaching an agreement to settle the outstanding claims and end the ongoing equal pay saga. It is also set to re-implement a strategy for the Oracle IT system.
Those improvements are encouraging, but challenges remain. In the short term, commissioner oversight and close supervision will still be required to maintain momentum. There is a difficult road ahead on key aspects of the best value regime—on governance and culture, financial management and service delivery—because substantial risks threaten the journey to reform and recovery. As Members will know, there is a live industrial action in waste services, involving one of the three recognised trade unions in that area. The Government will support the leader and his team in Birmingham, directly and through the commissioners, to move the council on from these historical issues. That support includes an increase in core spending power for 2025-26 of up to 9.8%, or £131 million. That figure includes £39.3 million through the new one-off recovery grant, which illustrates this Government’s commitment to correcting the unfairness in the funding system. We have also put in place an in-principle agreement for exceptional financial support totalling £1.24 billion.
Turning to the waste dispute, councils deliver over 800 vital services that make a huge difference to millions of people across the country. However, it is accepted that for many, the most visible and universal service is the collection and disposal of household waste. Members across the House will know that the current industrial action in the city is causing misery and disruption to local people, and I know that hon. Members whose constituents are affected will be acutely aware of that disruption.
From the outset, I want to be clear that the statutory intervention is led by commissioners, and Ministers cannot legally intervene in this industrial action. However, I have been in regular contact with the leadership of the council throughout this, as they have sought to find a resolution in which the reforms needed to build a sustainable council are still undertaken, and the waste collection service returns to functioning normally, in the way that Members would expect. This situation is causing public health risks to the city’s most vulnerable and deprived residents. As a result, Birmingham has today declared a major incident, so that it can use the mechanisms that it needs to better manage the impact on local residents. I support that decision, and I will back local leaders in bringing the situation under control in the weeks to come.
Well-established arrangements are in place to enable local areas to escalate issues when they need support, and the Government are monitoring the situation closely. This is a local issue, and it is right that the key public sector partners in Birmingham lead on it. If leaders in Birmingham feel that tackling these issues would require resources beyond those available to them, and request national support, we of course stand ready to respond to any such request. This Government will always back local leaders and give them the support that they need, not swoop in to criticise or take over from Whitehall. We will not hesitate to give support in any way that Birmingham leaders need. As Parliament would expect, a meeting will take place with the leadership of the council, the commissioners and other key local partners to ensure that we are doing everything we can to support and protect public health.
It is in the interests of all parties and, most importantly, for the benefit of Birmingham’s residents that this industrial action is brought to a close in a meaningful and sustainable way as soon as possible. We encourage all parties to redouble their efforts to get around the table and find a resolution. Any deal to end industrial action must maintain value for money and ensure fit-for-purpose waste collection services, without creating or storing up liabilities for the future. All parties recognise that Birmingham’s waste service has been in urgent need of modernisation and transformation for many years, so 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 to the residents of Birmingham. This situation simply cannot continue. I support the council on its journey to creating the sustainable, fair and reliable waste service that residents in Birmingham deserve. We will support the council in resolving its historic issues and establishing the leadership, governance and culture that will drive good-quality public services for the people of that city, so that it can take its rightful place with confidence as one of our great UK cities.
As the council moves to the next stage of intervention, I will continue to work with the council, commissioners and the wider local government sector to understand how we can best ensure that residents get what they need from their local council. I will monitor progress, as I have done since the general election, to ensure that continuous improvement led by the council can be secured. As I am sure the whole House would expect, the commissioner arrangements will need to remain in place while the situation in Birmingham is so fragile. The commissioners have a vital role to play in supporting Birmingham’s transformation, working hand in glove with local leaders.
The Government remain committed to working in genuine partnership with the city and its council, and I continue to encourage the council to strengthen its partnerships with regional stakeholders, including Mayor Parker in the West Midlands combined authority, to support economic growth and financial sustainability. We are keen to promote growth and regeneration opportunities for Birmingham, and we are confident that as the council continues to work to fix the basics, while making progress against the milestones, local stakeholders will be encouraged to work in partnership with the council to deliver a clear vision for the future.
I look forward to continuing dialogue with commissioners, the council and regional partnerships, including Mayor Parker, on opportunities for growth in the region. A partnership approach with a clear vision will increase Birmingham’s capacity to achieve sustainable growth. The people of Birmingham deserve a well-run, accountable and financially stable council with good public services, not least waste collection services. I am encouraged by the council’s leadership and commitment to the same, and I look forward to the council beginning to demonstrate more ownership of its recovery, and to seeing evidence that it can deliver the lasting improvements that are required. I will deposit in the House Library copies of the commissioners’ report, which is being published today on gov.uk.