Council reaffirm £500m roads budget cut news, after Tory group claim otherwise

The Birmingham Conservative Group has claimed the city is not losing £500m over the next 12 years in its road budget, despite the council confirming that it is.

It said the Labour-led council has “bankrupted Birmingham & is desperate to blame anyone else for their mess”.

However, the council has affirmed to TheBusinessDesk.com that it has received formal confirmation from the Department of Transport that the government is withdrawing its existing funding commitment.

It comes after council leader Cllr John Cotton revealed the cuts on Thursday, saying the government has “betrayed Birmingham”.

A Birmingham City Council spokesperson said the withdrawal of funding no longer allows “for the continuation of the restructured Highway Maintenance and Management Services PFI and the award of the operating sub-contract relating to the same.

“The council will now review the decision and the government’s rationale in detail and discuss how to proceed. Our priority remains continuity of service and ensuring the safety of our citizens and visitors across the network”.

But the city’s Tory Party Group said on X: “Disappointing to see for the 2nd time in 3 years Labour claiming that Birmingham is losing £50 million a year in highways funding when Birmingham City Council have confirmed this is not true.

“Labour has bankrupted Birmingham & is desperate to blame anyone else for their mess.

“The funding would only cease if the government of the day don’t renew it. That review isn’t for another 2 years. No decision either way has been made. As Labour say they will win the next general election, are they saying they’ve already decided to cut this?”

Birmingham City Council’s statement to TheBusinessDesk.com followed the Birmingham Conservative Party Group’s claims on X.

The Private Finance Initiative (PFI) deal was initially agreed upon in 2010 with Amey securing the 25-year contract, but the firm entered a performance dispute with the council and was forced to pay £215m to be released.

Kier was revealed as the preferred bidder for the £2.7bn PFI deal last month, after taking over the contract from Amey on an interim basis since April 2020.

Still supposedly subject to approval by the government, the deal would start in February 2024 and continue until June 2035. Kier would cover 2,500km of roadways and 5,000km of footways across the UK’s largest local authority.

The Department for Transport and Birmingham Conservative Group have been contacted for comment.