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Government agrees to reassess funding formula for Birmingham

City leaders want to see a funding deal which recognises that 83 per cent of Birmingham households are in the below-average council tax bands A-C.

Birmingham
Political parties in Birmingham joined forces to put together a case for the city

The Government has agreed to re-examine how Birmingham is funded after a crunch meeting with a cross party delegation of MPs and politicians for the city council to get a fairer financial deal.

The leaders of Birmingham’s Labour, Conservative and Lib Dem groups, backed by MPs, teamed up for the meeting with Local Government Minister Brandon Lewis.

They pointed out that current funding local government formulas gives a huge advantage to local authorities in the south at the same time as disadvantaging larger cities like Birmingham with its diverse social make up and high levels of unemployment.

Instead they want to see a funding deal which recognises that 83 per cent of Birmingham households are in the below-average council tax bands A-C meaning the city receives proportionately less income from local taxation than districts with high property values.

They also laid out the case that as a regional centre Birmingham City Council is creating jobs and providing services which are used by many living outside its local authority area – such as the thousands who commute in for work each day but do not contribute to local taxation.

They also said that with some of the highest rates of unemployment in the country the city has more need of support.

The Birmingham delegation which included Labour council leader Sir Albert Bore, Tory leader Lord Michael Whitby and Lib Dem leader Paul Tilsley, teamed up after agreeing a joint motion from the city council earlier this month on the fairness of the Government funding formula.

They recognised that the 2014/15 budget is now almost set, are looking for some movement in time for 2015/16 – the time at which council leader Sir Albert Bore expects to start decommissioning services if the expected austerity cuts continue.

Mr Lewis listened to the lobby and has agreed that Department for Communities and Local Government officials will meet with Birmingham City Council officials to go through the funding formulas in detail ahead of a follow-up meeting with the minister in the summer.

Edgbaston MP Gisela Stuart, who helped set up the meeting, said: “It was about what we can to get a fairer deal for Birmingham in 2015/16. We do not believe Birmingham is a special case, we just want a fair deal.

“Given that ministers never make promises in a first meeting, I think we had as positive an outcome as we could have hoped for and there will be further meetings in the summer after the officials have looked at the numbers.

“The cross party delegation we had, with strong representation from MPs, sent a strong message to the minister. He is in no doubt that Birmingham is speaking with one voice.”

Also attending the meeting was Erdington MP Jack Dromey who added: “The political parties in Birmingham have come together to put a very powerful case to government to secure a fair deal.

“It is clear that Birmingham has been short changed and that the further south you go, the more money you get from government.

“That cannot be right not least because Birmingham, although it is a great city, is also a city of great need and high unemployment.”

 
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