Birmingham City Council has announced plans to invest an extra £130 million in local services, as its leader declared the council is no longer “bankrupt”.
Leader John Cotton said the council has recovered financially almost two-and-a-half years after issuing a Section 114 Notice, which is often described as effective bankruptcy for local authorities.
The new budget proposals for 2026/27 include major investment in frontline services. The council said the funding will help improve street cleaning, make neighbourhoods safer, and deliver better services for residents.
The balanced budget has been supported by senior finance officers and government commissioners who have been overseeing the council’s recovery.
Cllr Cotton said the council has taken “tough action” to fix its finances and remove the “bankrupt Birmingham” label.
He said: “The council is no longer under a Section 114 Notice. Thanks to the decisive, tough action we took, the ‘bankrupt Birmingham’ tag is now a thing of the past.
“We have closed a £300 million budget gap, tackled equal pay liabilities, and are improving services for residents.”
He added that the council will continue making careful financial decisions to avoid past mistakes and provide better value for taxpayers.
The proposals will be discussed by the Cabinet on 10 February. A final decision will be made by councillors at a Full Council meeting on 24 February.
Cllr Cotton also said he wants to work closely with Richard Parker and the Government to bring more investment, housing, jobs, and services to Birmingham.
The announcement marks an important step in the council’s recovery as it aims to rebuild trust and improve services across the city.
