Commonwealth Games could bankrupt Birmingham

A new audit report has warned that hosting the Commonwealth Games in 2022 could bankrupt Birmingham City Council.

Accountants Grant Thornton released a S24 notice, reporting how the city had spent £116 million in emergency reserves in the last two years and that £52 million in savings were required in the next 12 months.

While the government will pay 75 per cent of the £750 million cost of hosting the 2022 Games, £180 million will need to be raised locally, sparking fears that England’s ;arrest local authority could face insolvency next year if its finances do not improve. The council plans to fund a swimming pool, an athlete’s village and public transport upgrades as part of their Commonwealth Games plans.

Grant Thornton’s report, seen by the Sunday Times, also reveals that there is a hole of £84 million in the budget for the 2022 Commonwealth Games, alongside an ongoing dispute with waste collectors which is costing £300,000 a month.

Councillor Meirion Jenkins, shadow cabinet member for resources and finance, said: “Unless Labour rapidly start getting costs and spending under control, and start living within their means, there is a danger of the council becoming insolvent next year. This would trigger a S114 notice, with very damaging consequences for the hardworking council-tax-payers and businesses in Birmingham.”

Birmingham’s successful bid for the Games was made possible after the competition was stripped from Durban due to the South African region’s own financial issues.