Local government officials from across the world are making a point of visiting Birmingham to discover how once-failing public services have been transformed, city council leader Mike Whitby has claimed.

Speaking on the eve of the fifth anniversary of taking power at the head of a Conservative-Liberal Democrat coalition, Coun Whitby said he had inherited a local authority in 2004 that was routinely condemned by the Government as under-performing after 20 years of Labour rule.

Social services, housing and the planning departments performed so badly that responsibility for running them was on the verge of being taken away from the council and given to Whitehall when the coalition took over, he told a scrutiny committee.

An ambitious business transformation programme, which aims to save £1 billion over 10 years through better IT systems and more efficient ways of working, had caught the imagination of council leaders in this country and abroad who were keen to find out what Birmingham was doing.

The city had begun to build new council houses for the first time in years, which was an achievement most other local authorities could not match, he added.

Coun Whitby (Con Harborne) said: “Many of our directorates are now being visited by the heads of local government who want to learn about what we are doing in business transformation. Not just in the UK, but people from Europe and the Middle East also want to look at how we are working.

“We are being held up now as an example of good practice, whereas five years ago we were derided as under-performing.”

He was accused of exaggeration by deputy Labour group leader Ian Ward, who reminded the council leader that Birmingham recently had its annual performance star ratings reduced by the Audit Commission after social service provision for children at risk of abuse was found to be inadequate.

Ministers ordered the council to work with financial consultants PricewaterhouseCoopers to draw up a social services improvement plan.

Coun Ward (Lab Shard End) added: “I don’t accept that the Whitby model of local government is being exported across the world.

“Birmingham City Council lost a star and is now ranked in the bottom 20 per cent of local authorities in the country.

“I just wonder whether the council leader has the full picture of what is going on?”

Coun Whitby said: “This city was in a chaotic state five years ago. We had housing, planning and social services in special measures and 10 successive inflation-busting council tax rises.

“There has been discernible improvement since then and we are on a journey to excellence.”