Firms caught up since last October in a backlog of 30,000 unpaid bills at Birmingham City Council may have to wait for their money until the end of February, it was confirmed last night.
Problems with the Voyager computer system, which was sold to the council on the basis that it would speed-up the payment of invoices, have been sorted out but the effects of the "teething problems" are likely to be felt for several more weeks, according to deputy council leader Paul Tilsley.
Councillor Tilsley insisted everything possible was being done to eliminate the backlog as quickly as possible.
He admitted 9,000 cheques are waiting for signature, 18,000 are trapped in the system and 3,000 will have to be processed again because they were rejected by faulty scanning equipment.
The Voyager system was installed at the end of October by private outsourcing firm Capita, which runs the council's new IT arm Service Birmingham. The new equipment was supposed to reduce the amount of staff time taken to process invoices and help produce £280 million in savings for the council over 10 years.
Instead, the council has suffered the embarrassment of being threatened with the bailiffs by creditors and the withdrawal of services by some small firms - including the supply of newspapers to city libraries.
Coun Tilsley (Lib Dem Sheldon) warned that failure to get rid of the backlog by the end of February could cause serious problems since the number of invoices submitted to the council rises steeply in March, the end of the financial year.
He added: "This relates to one item of software used for scanning invoices that wasn't as reactive as we had hoped.
"I am hopeful that we will eliminate the backlog by the end of February so that we can deal with an avalanche of invoices in March. The backlog is reducing now, it is not growing. We are throwing all the resources we can at this."
He accepted the new system was not flexible enough to deal with issues arising from the abolition of petty cash in children's homes and old people's homes. There have been examples of staff who were forced to use their own money to buy food for residents still waiting for reimbursement.
Coun Tilsley added: "There are specific issues that we need to pick up. If it is a matter of flexibility of the system we need to make that happen."
He warned that the council would not take short-cuts with public money.