Labour won’t bail out bankrupt councils, the shadow chancellor has stated.
“I am not going to have the ability to repair all the issues straightaway,” Rachel Reeves stated throughout an interview on Sky Information’ Sunday Morning With Trevor Phillips.
Her feedback comply with Birmingham Metropolis Council successfully declaring chapter after being hit with a £760m invoice to settle equal pay claims.
In response, the council accredited plans to hike council tax by 21% over the following two years, in addition to £300m in cuts over the identical interval.
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Requested if she would bail out the councils, permit them to boost taxes or inform them to sink or swim, Ms Reeves stated: “I am underneath no illusions concerning the scale of the problem that I’ll inherit if I grow to be chancellor later this yr and I should be sincere with folks.”
She added: “My focus is on reforming the planning system to get Britain constructing once more…
“If we do these issues, we’ll convey within the tax income and we can spend money on public providers once more. There isn’t any shortcuts. That’s the approach.”
Through the Sky Information interview, Ms Reeves additionally stated scrapping the non-dom tax standing is “an utter humiliation for this authorities”.
“The final price range of this parliament – they’ve had 14 years and so they use this second to shut a non-dom tax loophole that everybody has been conscious of for years,” she added.
Shadow chancellor Rachel Reeves and Labour chief Sir Keir Starmer. Pic: PA
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Different councils have successfully declared chapter
A number of different councils have successfully declared chapter, with Hackney Council issuing a bit 114 discover in 2000 and Northamptonshire County Council following go well with in 2018.
Croydon Council issued its third part 114 discover in two years in November 2022. Thurrock in Essex made the identical transfer in December 2022 after it acquired into difficulties over borrowing massive sums to spend money on photo voltaic power.
Woking issued a bit 114 in June 2023 as a consequence of what it stated was “a particularly severe monetary shortfall owing to its historic funding technique that has resulted in unaffordable borrowing, insufficient steps to repay that borrowing and excessive values of irrecoverable loans”.
