Nottingham: Wide-ranging cuts approved at 'bankrupt' city council

Nottingham City Council declared itself effectively bankrupt last year

Nottingham city councillors have approved cuts to jobs and services aimed at plugging a £53m budget gap.

The council declared itself effectively bankrupt in November, warning it would not be able to balance its books for the current financial year.

Plans for the year from April include hundreds of job losses and cuts to social care and youth services.

A review of libraries is also planned along with a council tax rise of almost 5%.

The Labour-run authority has blamed a reduction in funding from central government, rising demand for services and high inflation.

The public gallery was packed for the budget meeting

The government appointed commissioners to help run the council in February.

Changes were already being overseen by a government-appointed board following the collapse of council-owned Robin Hood Energy in 2020, but commissioners now have direct decision-making powers.

Council leader David Mellen said councillors voted "with great reluctance".

"Nobody was pleased to vote in favour of this budget, nobody thought it was going to be great for the communities they represent," he said.

"It was under duress. It wasn't a freedom of expression. It was a need to do the responsible thing for the sake of the services run by Nottingham City Council."

The authority has also been given special permission to fill some of the budget gap through a process known as "exceptional financial support".

Rather than be provided with a cash grant, the council will be loaned money, which it will have to pay back by selling assets over a number of years, potentially raising £66.1m to fund day-to-day services.

A spokesperson for the Department for Levelling Up, Housing and Communities (DLUHC) said: "Councils are ultimately responsible for their finances and will see their overall funding for the upcoming financial year increase to £64.7bn - a 7.5% increase in cash terms.

"The government has also provided Nottingham City Council with further financial flexibilities so it can balance its budget and deliver vital services."

Analysis

By Hugh Casswell, BBC Radio Nottingham political reporter

Councillors say their hands are tied.

It is a bizarre situation that sees them voting in favour of cuts that they don't agree with.

Regardless of the commissioners who can now overrule them, the ultimate legal duty to set a balanced budget takes precedence, and has even seen some councillors taking legal advice about their personal liability for if they'd voted it down.

Doubtless, the argument over who is to blame for the council's financial woes will continue.

But one thing everyone agrees on is that these cuts will hit the city like none that have come before.

Speaking to BBC Radio 4's Today programme on Tuesday, Mr Mellen said a combination of a rising social care bill and a shortfall in central funding had been major factors in the authority's financial problems.

"These are cutting beyond the fat into the bone," he said.

"Things that are basic requirements for people to have a library in their community, to have community protection officers in their streets, to have a voluntary sector that offers cheap play schemes to children and their families.

"All those things are a basic requirement of councils and those are the areas that we're having to cut today because of a broken care system that a number of prime ministers have said that they will fix but they haven't done it."

Community leaders in the city have also expressed concerns about the scale of the cuts.

Youth club founder Keiren Thompson, who won the 2019 Sports Personality of the Year Unsung Hero award for his work helping young people, said: "We want to steer young people in the right direction but without the resources and the funding we can't make that happen."