The deal brokered to end the crippling Birmingham bins strike could leave the city council facing financial meltdown, a crisis report has warned.
The document warned of “significant potential financial implications” if the authority did not follow through with its controversial jobs and hours shake-up, which triggered the seven-week walkout by Unite union members.
It said the council – which spent over £300,000-A-WEEK responding to the strike – would be unlikely to be able to effectively defend equal pay claims of the type which have cost it more than £1.1 billion in recent years.
The huge bill came about when it emerged that bonuses, shift allowances, shorter working hours and routine overtime paid to binmen up to 2011 were not made available to other employees.
The report, written by interim chief executive Stella Manzie, warned that a rush of new claims would “wipe out” the pot of cash earmarked to settle the litigation – as well as any uncommitted investment funds and “all available” reserves.
Ms Manzie said spending in other areas would also need to be slashed to the bone and the authority would even be forced to consider whether it could set a “lawful and balanced budget”.
The report, to be discussed on Thursday, is acutely embarrassing for council leader Coun John Clancy, who was personally credited with ending the strike by Unite after talks at conciliation service Acas.
Crews returned to work after council bosses “agreed in principle” to keeping more than 100 grade three supervisor roles as part of Birmingham’s rubbish collection teams.
The authority had wanted to change dustcart crews’ working hours and downgrade the supervisor jobs.
The consequences of the council refusing to endorse last week’s deal were unclear.
But Unite said last week that the strike had only been suspended – raising the protect of a renewed walkout if the agreement breaks down.
Conservative opposition councillor Matt Bennett angrily tweeted that the cabinet report made “shocking reading”.
He added: “Clancy has messed up badly and officer clearly unhappy”.
