Birmingham faces £25m Commonwealth Games shortfall

Birmingham is facing a £25m shortfall in funding for this summer’s Commonwealth Games.

Papers show the city council was expecting to raise £75m from partners but has so far secured £50m, meaning it will likely be forced to use contingency funds if the gap is not met in the next couple of months.

The council and partners are expected to provide £184.2m for the Games, with the overall cost around £778m.

The Resources Overview and Scrutiny committee is due to discuss the shortfall at a meeting on Thursday.

The committee paper said: “As has been previously reported to this committee the council’s initial expectation was that partner funding contributions towards the council’s £184.2m share of the cost of the games would be secured to the value of at least £75m including contributions from the West Midlands Combined Authority, regional local enterprise partnerships, local universities and the Midlands Engine.”

“Despite extensive engagement over a number of years at both political and senior officer levels to date it has only been possible to secure partner contributions amounting to £50m, with secured contributions from the West Midlands Combined Authority (£25m), Greater Birmingham & Solihull LEP (£20m) and Community Infrastructure Levy (£5m).”

“It is anticipated that the entirety of this contribution will have been drawn down by March 31, 2022.”

The paper added that, due to the “substantial impact” on public finances as a result of the Covid-19 pandemic in particular, it is considered “extremely unlikely” that any further partner contributions will be secured.

It said: “In recognition of the increasing likelihood of a £25m shortfall in partner funding contributions, Cabinet agreed on July 27, 2021 that this amount should be set aside from the overall Corporate Capital Contingency – to mitigate the risk of this funding shortfall and ensure that the council’s commitments under the terms of the Host City Contract could continue to be met, and to ensure that the delivery of the capital investment required for the games was not undermined.”