Birmingham goes bust – but how many others could follow suit?  

Welcome to Wednesday’s Early Edition from i.

Just over a year ago all eyes were on Birmingham as it put on a spectacular closing ceremony for the Commonwealth Games. At the time, it was said the £700m investment for the Games could be a catalyst for change and the beginning of a “golden decade of opportunity”. But now, the largest local authority in Europe has declared itself effectively bankrupt. Yesterday it issued a section 114 notice, which restricts all but essential spending. The leader and deputy leader of the authority called the move a “necessary step as we seek to get our city back on a sound financial footing”. Council leaders blamed a £760m bill for equal pay claims, the implementation of an IT system, government cuts, as well as higher demand for services and soaring inflation. But Birmingham is not the only one. Woking, Thurrock, Northamptonshire, Croydon and Slough have issued 114 notices in recent years. Last night, Local Government Association spokesman Peter Marland said a lot of councils “are now on the precipice of financial catastrophe”. What’s going on, and how many others could be affected? We’ll take a look after the headlines.

Today’s news, and why it matters

 Dangerous concrete “could be anywhere” due to its widespread use in buildings from supermarkets to MoD sites across the UK, specialist surveyors have warned. Warnings over the use of reinforced autoclaved aerated concrete in schools has seen a surge in enquiries to surveyors as local authorities and building owners look to get their premises assessed.

Leaseholders could face huge bills of potentially thousands of pounds to pay for RAAC concrete safety checks and remedial work on their homes, i can reveal. More than 100 schools and colleges built using RAAC concrete have been ordered by the Government to fully or partially close due to safety fears, following the recent collapse of a beam previously considered safe.

NHS staff are fighting a daily “running battle” against the risks of “catastrophic failure” posed by unsafe concrete found in hospital locations including maternity wards and intensive care units, i can reveal. In one hospital, managers have resorted to providing training to cleaning staff to help spot tell-tale signs of dangerous structural decay, while at another site senior staff have acknowledged that, despite a spend of nearly £75m on ongoing repairs, “structural failure cannot be fully ruled out”.

A renter over the age of 55 was served a no-fault eviction at a rate equivalent to every 16 minutes over the past three years in England, research by a homelessness charity has revealed. Shelter said the research reveals why the Government must pass its long-awaited Renters’ Reform Bill, which will abolish Section 21 evictions, which allow landlords to evict tenants without giving a reason.

Russia’s Wagner Group is set to be proscribed as a terrorist group by the UK Government, it has been announced – putting the group on par with Isis and some neo-Nazi groups. Suella Braverman, the Home Secretary, said: “Wagner has been involved in looting, torture and barbarous murders. Its operations in Ukraine, the Middle East and Africa are a threat to global security.”

The scale of illegal sewage spills into UK waterways is likely to be far higher than has been made public so far, experts have warned. The revelation that three water companies may have illegally released sewage on 388 occasions last year, in a process known as “dry spilling”, is a “canary in the coal mine”, campaigners told i.

Three questions over financially stricken councils:

Why did Birmingham City Council go bankrupt? Much attention has been given to the council’s £760m bill from an equal pay settlement. Birmingham City Council has paid out almost £1.1bn in equal pay claims since a landmark case was brought against it in 2012. Yesterday a spokesperson said: “The council is still in a position where it must fund the equal pay liability that has accrued to date, but it does not have the resources to do so.” The payouts came after the Supreme Court ruled in favour of 174 mostly female employees – working in jobs such as teaching assistants, cleaners and caterers – who had missed out on bonuses awarded to staff in more traditionally male-dominated roles such as refuse collectors and street cleaners. But the council faces other problems, too. A new IT system first estimated to cost £19m has spiralled to around £100m. On top of that, high inflation and higher demand for adult social care has added to the financial pressures, according to Sharon Thompson, deputy leader of the council. And, she added: “Birmingham City Council faces longstanding issues… which have been compounded by the reality that Birmingham had £1 billion of funding taken away by successive Conservative governments.” Whether the Commonwealth Games contributed to the fiscal problems also remains to be seen. But the Labour-led council also faces accusations from other political parties that it had helped “create this mess”. Birmingham Liberal Democrats group leader Roger Harmer said: “It smacks of sheer arrogance, that the council can sit and blame others for their inability to manage the council effectively. Not one of them has apologised to the people of Birmingham for this failure, not one.”

Will services be cut? The Lib Dems’ Roger Harmer warned the decision to issue a section 114 notice would “be felt most sharply by the most vulnerable in our city.” He continued: “Every one of Birmingham’s citizens will feel the pain of this decision as we move into uncharted waters. Services will be cut to essential only, meaning that many services that people rely on, services that are essential to those people, are going to be cut.” So far the council has said it will “continue to deliver services to the residents of Birmingham whilst we consider the issues that they have and how fiscal responsibility can be restored”. Frontline services such as social care for adults and children, child safeguarding, waste collection, road maintenance and library services are all considered essential and will continue, council leader John Cotton told Birmingham Live. But he was unable to answer when pressed on whether those services would be delivered in the same way or with the same regularity. West Midlands mayor Andy Street warned residents could now face a hike in council tax rates. And the Guardian cited a senior figure in local government who suggested the city council could be forced to slash spending on non-statutory services, such as public amenities, highways, maintenance, green spaces and grants for community groups.

How many other councils are in a similar position? The problems faced by Birmingham City Council are not entirely unique. Cllr Tim Oliver, Chairman of the County Councils Network, said higher inflation, soaring interest rate rises and unforeseen increases in demand for social care has meant many councils were now facing “significant overspends”. He said his network warned county authorities in March they would have to save £1bn collectively this year. “This figure will have increased significantly since then with many councils now putting in place recovery plans which could include further service reductions and spending freezes, as well as use of one-off reserves,” he said. The Local Government Association’s Peter Marland told BBC’s Newsnight that “most councils are facing … a huge demand rise and they haven’t got the money to fund it. A lot of councils are now on the precipice of financial catastrophe.” Jonathan Carr-West, chief executive at LGUI, also warned “Birmingham is the biggest council to fail so far, but unless something changes, it won’t be the last.” Earlier this month, Paul Waugh detailed some of the problems facing councils around the country, from bad financial management, to rising costs of social care and housing shortages. He points out: “One problem with council finances is the sheer lack of visibility they receive. Partly this is due to the sad hollowing-out of local newspapers.” Read his full piece here.

 Around the world

 The former leader of the far-right Proud Boys militia has been jailed for 22 years for his role in planning the 6 January 2021 assault on the US Capitol. Enrique Tarrio, 39, was convicted on charges including seditious conspiracy over the attack. Judge Timothy Kelly, a Trump appointee, said a stiff punishment was required as a deterrent, saying “It can’t happen again. It can’t happen again.”

Anti-regime protests that are spreading across Syria could be the spark of another revolution, opposition activists have said, 12 years after similar demonstrations turned into a full-scale civil war that killed hundreds of thousands of people. Videos on social media have shown hundreds of people gathering in the main square of Suwayda, waving flags of the Druze minority and chanting “long live Syria, and down with Bashar al-Assad”.

The coach of Spain’s World Cup-winning women’s football team, Jorge Vilda, has been sacked amid the crisis over the conduct of federation president Luis Rubiales. Vilda led his team to a 1-0 victory over the Lionesses during last month’s World Cup final in Australia, but has since faced criticism for applauding a speech in which Rubiales decried calls for his resignation as a “witch hunt”.

Three people on board a catamaran in the Coral Sea off the northeast coast of Australia have been rescued after the vessel suffered several shark attacks. Satellite photos and a video showed a large part of the stern of the yacht torn away.

Day visitors to Venice will be charged €5 to enter the Italian city’s historic centre from next spring as the city attempts to reduce tourist numbers. Residents, commuters, students and children under the age of 14 will be exempt, as will tourists who stay in the city overnight.

 Watch out for…

 Rishi Sunak, who faces tough questions over the crumbling concrete crisis at his first PMQs in seven weeks.  

 Thoughts for the day

 Rishi Sunak views spending as a burden on the Treasury – not an investment in the state. Yes, every penny has to be spent wisely, but the lack of hard cash is the most worryingly concrete fact of this sorry saga, argues Paul Waugh.

How any politician who knew about the RAAC concrete scandal can sleep is beyond me. Gillian Keegan wants us to thank her for doing a good job, when we should be furious, says Jordan Tyldesley.

Adopting my cats confirmed it – I’m not made for parenthood, reveals Aimee Meade.

 Culture Break

 I went to a ‘grief rave’ after my friend died – here’s what happened. A public art project is touring the world helping people process their grief through music. Lauren Potts reveals her own experience.

 The Big Read

 ‘My son lived off Deliveroos and fizzy pop’: The guilt, tears and loneliness of single-parent MPs. Westminster is notorious for anti-social hours and the pressures it puts on family life. So how do MPs manage when they are bringing up children alone?

 Sport

 Jordan Henderson’s squirming on Saudi Arabia proves virtue-signalling players ‘can be found out very quickly’. The former Liverpool captain tried to insist he had not abandoned his ‘values’ and support of the LGBT+ community, writes James Gray.

 Something to brighten your day

 An ancient aroma called the “scent of the eternity” has been recreated by scientists studying ingredients used in Egyptian mummification balms. The fragrance is based on beeswax, plant oils and tree resins found in the balms, which were used more than 3,500 years ago to preserve the noblewoman Senetnay.