Plans to axe 405 social services jobs at Birmingham City Council will cost £17 million in redundancy and pension enhancements, it has emerged.
But the council expects to save almost £90 million in wages over five years from what is thought to be the local authority’s biggest ever workforce cull.
The cost-cutting programme, which will include compulsory redundancies, is driven partly by a financial crisis in the Adults and Communities Department.
A Government pledge to offer free personal social care to older people in the greatest need of help will cost £5 million a year in Birmingham.
The council is also looking to the voluntary sector to deliver more social services, which means less in-house work for the department’s 4,000 employees.
Some of the jobs at threat are in the city’s 29 old people’s homes which are being closed and replaced by purpose-built care centres.
But it is expected that most of the redundancies will be achieved by slashing posts in management and administration.
A city cabinet report predicts that the average redundancy payment will be £16,000 per person.
But pension enhancements payable under a council redundancy agreement with the unions will add an average £41,000 per person to the bill.
The cabinet will ask the government for special permission to borrow money to meet the £17 million up-front redundancy costs.
Adults and Communities director Peter Hay is seeking volunteers for redundancy but he admits it is highly unlikely enough people will come forward.
Mr Hay said: “Due to the scale and change and the numbers of staff affected by the Adults and Communities transformation and reprovision of services, it will not be possible to avoid some compulsory redundancies.”
He added that although Birmingham has a relatively low proportion of elderly people compared to the rest of England the council faces higher costs than other cities because older people here are “poorer and sicker” than the national average.
Mr Hay said: “There will be a reduction in the overall management structure in terms of costs to enable continued investment in professional social care at the frontline.
“The new structure will be completely different to the existing organisation to enable new ways of working and support the future delivery model. The new structure will reflect a citywide service to be delivered, where needed, to constituencies.”