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The Labour-run authority has been criticised for its handling of the equal pay claims by opposition councillors as well as the GMB union, which represents the claimants. It has itself apologised for failing to get the situation under control.
Council leader John Cotton, who has only been in post since the end of May, said the authority would be “open and transparent” to ensure “proper accountability for these failings”.
“I’ve been clear from day one that I will take whatever action is needed to address the substantial challenges facing the council and these measures are essential to grip the situation – particularly in terms of financial controls, organisational capacity and improved governance,” he said.
His deputy leader, councillor Sharon Thompson, added the costs were “one of the biggest challenges this council has ever faced”.
“Given the scale of this challenge, we must impose mandatory spending restrictions,” she said.
Two of the city’s Labour MPs have called for government intervention to ensure the council would not have to limit its services.
“What we don’t want to see is just statutory services being delivered,” said Preet Kaur Gill, MP for Birmingham Edgbaston.
“We need to make sure the council can deliver all of its services.”
The BBC has contacted the DLUHC for comment.
It has not yet responded, but previously said it holds discussions with any councils facing unplanned pressures.
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