Council budget to avoid bankruptcy approved

Middlesbrough's mayor warned the council to accept the budget, or it would need to declare bankruptcy

A council on the edge of declaring effective bankruptcy has agreed to accept new budget proposals.

The majority of Middlesbrough councillors voted through plans which include the maximum council tax rise, along with a charge for green waste collection.

They also agreed to accept exceptional financial support from the government, allowing the council to borrow £13.4m, the Local Democracy Reporting Service said.

Mayor Chris Cooke told the meeting if they did not accept the budget proposals, the only option left would be the issuing of a so-called section 114 notice.

The full council meeting at the town hall on Friday saw 25 councillors vote for the budget plans and 16 against while five abstained.

Mr Cooke told the meeting a section 114 notice would take away control from local people “at significant cost”.

Labour councillor Matt Storey said it was one of the most important budgets ever considered by the council, and refusing it would result in the “decimation of every service in the town”.

He added: “This is not the night to play politics with the budget.”

Opposition

Conservative councillor Mieka Smiles, who was among the 16 voting against the plans, said the council tax increases on many people in her ward of Nunthorpe would be “totally intolerable” while seeing “a greatly-reduced level of services”.

Also voting against the budget proposals was Conservative councillor Luke Mason, who said he would not let some of the executive members “run a bath” and said the mayor had backtracked on a “promise” to remove the Linthorpe Road cycle lane.

He also noted an audit which found the cash-strapped council racked up a bill of almost £8m on its corporate purchase cards in 2022-23, which he said had “grossly undermined” his confidence.

Regarding the purchasing cards issue, councillor Nicky Walker, executive member for finance and governance said the period covered in the investigation took place under the previous administration.

She said officers identified the problem and solutions were put in place.

“Please don’t put that at their door,” she added.

Financial support

The council previously rowed back on two elements of its budget proposals after public opposition, deferring plans to close the Captain Cook Birthplace Museum in Stewart Park and scrapping the plans for new parking charges at the Marton park.

Middlesbrough Council will be one of 19 local authorities to receive exceptional financial support to manage financial pressures.

It means the council will have permission to borrow money to fund day-to-day spending in 2024-25 only, in a way not usually permitted.