Birmingham Councils £2.7bn PFI deal with Amey ends in divorce

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The infamous £50m pair of bollards

After eight years the £2.7bn PFI deal which Birmingham city council made with private contractor Amey has come to an end.

Amey have agreed to pay the council £160 million to exit early from the contract  to look after the highways for 25 years, which was at the time the largest PFI contract for highways, covering the management and maintenance of more than 2,500km of highways, 96,000 street lights, 1,000 traffic signals and more than 850 bridges, structures and tunnels.

In a joint statement agreed after a hearing in the Court of Appeal, the contractor and council announced that:

“The full retendering of the project to find a permanent replacement contractor will take place during 2020-21.”

Workers and ratepayers in Birmingham deserve much better than another hashed PFI outsourcing nightmare. PFI has been proven to be unable to deliver public services time and again. Contractors assume that they will be able to deliver the promised services on a shoestring, happy to cut staff numbers, slash pay, pensions, work breaks, travel time and other rights of employees in their quest to make a profit. Workers must demand that these services are taken back in house.

Politically the lesson for workers is that the Labour party which nationally and locally championed PFI and continues to support big business interests is no friend of the working class. The fight for socialism cannot be taken forward by those who hide this truth from the workers.

 

 

Birmingham council cash reserves increase by 736%

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100,000 children in Birmingham live in poverty according to the Children’s Society.  Birmingham is a young city with almost half its 1.1 million residents aged under 30. Birmingham’s parents earn very little with one in five workers in Birmingham earning less than the Living Wage of £8.25 per hour.

From the above its clear to anybody that the services provided by the city council to meet the pressing needs of Birmingham’s poorest are absolutely essential. Any reader will know that Birmingham city council, under a Labour administration, has waged a ruthless campaign of cuts to services and attacks on the working conditions of council employees, with bin strikes and care worker disputes making regional and national news.

The Labour party career councillors blame it all on Tory cuts, they say there is simply no money. The same excuse is used by their acolytes in the Socialist Party and other Trotskyite groupings.

It’s a similar picture up and down the country, where two-faced councillors squeeze the poor while building up cash reserves, handing the assets over to private contractors and wasting millions in short sighted projects and on overblown salaries for top executives.

In a lengthy report published in The Times, it is alleged that Birmingham council like many others has built up huge cash reserves in the last ten years whilst drastically reducing spending on services. The piece details hundreds of local authorities with Birmingham city council topping the table for having increased its cash reserves by £411 million in eight years.

“English councils have amassed huge cash reserves while blaming budget cuts for reduced spending on services, official figures suggest.

Local authorities, excluding police or fire and rescue authorities, were sitting on £21.8 billion of non-ringfenced reserves last year, £5 billion more than they had in 2017 and £11 billion more than they had at the start of the decade.

Spending on local services, including libraries, parks, bus services and bin collections, has fallen by about 21 per cent since 2010, when the government began slashing the central grant it gives to local authorities. Many councils have also been raising council tax bills.

The Taxpayers’ Alliance, which campaigns for lower tax, said that some authorities were making questionable decisions with their budgets that meant residents ‘paying more for less’.”

Midlands local authorities change in non-ringfenced reserves since 2010

Birmingham £411m 736%
Nuneaton & Bedworth £9m 338%
Worcester £8m 265%
Warwickshire £96m 259%
Daventry £19m 238%
Coventry £69m 236%
Rugby £6m 221%
Stratford-on-Avon £8m 208%
Warwick £5m 38
Worcestershire £20m 32%
North Warwickshire £1m 21%
Redditch £0m 12%
Dudley £5m 10%
Wolverhampton £-3m -5%

According to the report Coventry city council said it could no longer afford to provide free school buses for disabled children whilst “holding £97.6 million in usable reserves, up 76 per cent on 2017.” Coventry is planning a further £11 million of cuts.

“In its annual accounts the council accepted that it was difficult to explain the need for such high levels of reserves but said that the financial challenges it faced and projects it had established provided a ‘strong justification’.”

Water water everywhere but not a drop to drink

All this cash floating about without a penny for the workers pay, nor services for working class families reminds us of the tale of the ancient mariner,  ‘water water everywhere nor any drop to drink’. In that poem the ancient mariner brought a curse upon his shipmates by shooting an albatross and he is forced to wear the albatross around his neck as his shipmates suffer from thirst.

The working class prolongs its suffering in the continued support of the imperialist Labour party. The Labour party and its deeds hang on our necks, never has it been clearer that workers need to build a Communist Party to lead the fight for socialism and rid ourselves of the curse of class collaboration, fake socialism and opportunism in the ranks of the labour movement. Get in touch: