'Head-in-sand' Birmingham was equal pay 'outlier'

By Caroline Gall

BBC News, West Midlands

Birmingham City Council’s financial crisis was down to “burying its head in the sand” over equal pay liability, a lawyer who represented claimants said.

The council has already paid out more than £1bn in compensation to underpaid workers.

But on Tuesday it declared itself effectively bankrupt and linked the situation to further equal pay liability of £760m.

The council previously apologised for not getting the issue under control.

Stefan Cross KC said most authorities had not handled equal pay issues “as badly”.

Speaking to BBC Midlands Today, he said Birmingham officials had “put their heads in the sand for so long, the problem became so massive”.

He said: “Its unlikely that many councils would get themselves into such an extremely difficult position. It’s certainly possible – there’s nearly a million women who worked for local government, if they all had equal pay cases on an on-going basis, you have a huge problem.”

But he added the council was nevertheless an “outlier” in terms of the “extreme difficulties that they have created for themselves”.

On Tuesday, the Labour-run authority – the largest in Europe – issued a Section 114 notice; an admission it could no longer balance its books. It meant new spending would cease on all but essential services – the delivery of which has been promised in recent days by council leader John Cotton.

In June, it emerged the £760m equal pay liability was not only equivalent to the entire annual spending on services but was growing each month. The council apologised at the time for the situation.

The authority said on Tuesday its bill was increasing at a rate of £5m to £14m per month, but it had insufficient resources to meet the liability and there were no other means to pay.

A pay-out of £1.1bn to settle claims in 2012 followed a court ruling that found hundreds of mostly female employees, working in roles such as teaching assistants, cleaners and catering staff, missed out on bonuses given to staff in traditionally male-dominated roles such as refuse collectors and street cleaners.

Mr Cross said if the council had a figure in mind for the liability, that should have been formally communicated to interested parties.

There had been, he said, council “acceptance” the cases were worth £760m, but, he claimed, “they did that without consultation with the trade unions, without discussing the figures and without discussing a way forward – it fits a pattern of rather bizarre management strategy to be honest”.

Glasgow Council admitted its liability in about 2017 and had still not resolved its issues six years on, and if the same was to happen in Birmingham, the authority would face an extra bill of more than £1bn, he added.

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