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Birmingham, the second-biggest metropolis in Britain, declared itself bankrupt on Tuesday, shutting down all non-essential spending after being issued with equal pay claims totaling as much as $954 million. The Birmingham Metropolis Council filed a Part 114 discover on Tuesday, halting all spending apart from important companies.
Within the discover, town council mentioned it was at present in a destructive basic fund place due to the price of offering for equal pay claims. The claims, it mentioned, would end in exceeding the monetary sources out there to the council. “Which means spending due inside that interval exceeded the monetary sources out there to the council in that very same interval.”
The potential value of latest equal pay claims could be between £650 million (round $816 million) and £760 million (round $954 million), the discover additional mentioned, including that the council doesn’t have ample sources to cowl this potential legal responsibility. “It’s doubtless that the Council might want to recognise this legal responsibility within the present or earlier monetary years which can end in a destructive Common fund stability. That is an unsustainable monetary place for the Council to be in.”
Within the backdrop of the disaster, the discover mentioned, the council is prevented from getting into into any new settlement or dedication for expenditure and all non-essential expenditure will now cease with quick impact. The Birmingham Metropolis Council supplies companies for a couple of million individuals, in keeping with CNN. Birmingham, the biggest multicultural metropolis in central England, had hosted final yr’s Commonwealth Video games.
In June this yr, the council had mentioned it was in talks with the federal government after revealing it needed to pay as much as £760 million to settle equal pay claims. The invoice was equal to its whole annual spending on companies and was rising by as much as £14 million every month, BBC mentioned in a report in June.
In 2012, Britain’s Supreme Court docket directed the council to pay claims made by a whole lot of girls for the financial discrimination they suffered. The apex court docket had discovered that a whole lot of largely feminine staff working in roles akin to instructing assistants, cleaners, and catering workers missed out on bonuses that got to workers in historically male-dominated roles akin to refuse collectors and road cleaners, BBC mentioned.
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