Local councils face financial crisis with billions in debt, warns credit agency

More English councils expected to fail owing billions in debt, warns Moody's credit rating agency
Council borrowing for commercial investments increased over past decade to offset funding cuts
Moody's lists 20 most indebted councils relative to income, 7 in Surrey
Lack of scrutiny since Audit Commission scrapped in 2015 resulted in auditing backlog
Moody's warns council financial recovery will take "many years" despite new accountability measures

theguardian.com

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9/9/2023

Birmingham Declares Bankruptcy Due to Equal Pay Disputes and Overspending

The Birmingham City Council in England has declared itself bankrupt due to financial difficulties, with the main causes being equal pay claims and excessive spending on projects such as an IT system and the Commonwealth Games bid. The council has issued a Section 114 notice, halting all but essential spending. The Conservative government has refused to provide further funding, stating that it's the responsibility of local councils to manage their own budgets.