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All my bandwidth this week has been given over to the spring budget, the moment of the year when Chancellor Jeremy Hunt tells us his plans for the economy – how he’s going to cut our taxes, or increase and set out where he’s going to spend some of our money.

But this week was a tale of two budgets: the one obsessed over in Westminster and then the budget of Birmingham Council, which has huge repercussions for the city’s one million plus population.

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I didn’t think much about the Birmingham story over the past few days as I joined the rest of the Westminster village in obsessing about whether the chancellor was going to cut national insurance or income tax, administer further public spending cuts to boost tax giveaways (and give a future Labour government a headache) or nick the opposition’s plan to abolish tax breaks for so-called wealthy “non-doms” who live in the UK with a permanent home overseas (FYI: Hunt didn’t shave more off future spending plans but they did nick Labour’s plan to scrap non-dom plan to raise £2.7bn for tax cuts).

But the dire situation of many councils across England is perhaps what is closer to the hearts of our Electoral Dysfunction listeners.

Sure the national budget matters hugely in setting the economic direction of our country and deciding on what public services with prioritise.

But local council budgets service much of our daily bread and butter: Our bin collections, childcare services, adult social care, leisure centres, parks and libraries, our carparks and road maintenance.

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Between 2010 and 2020, local government fund suffered a 40% real terms cut in grants from central government.

In December nearly one in five council bosses said they thought it “fairly or very likely” they will go bust in the next 15 months as funding fails to keep pace with inflationary costs, and rising demand for a raft of services – be in child protection or adult social care.

And it was Hayley’s email that landed in our Electoral Dysfunction inbox that pulled my attention out of Westminster.

Hayley, who has been an officer in local government for the last 20 years, emailed in to talk about how “the last few years have been difficult”.

“In a district council setting, that I have always been incredibly proud to work in, I’m now left feeling like I might need to move on – mentally exhausted, emotionally drained,” she said.

“It’s impossible to feel like you are delivering anything meaningful because of reducing finance and increasing demand.

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Good people are leaving and the public perception is at an all low – and I have a huge amount of sympathy for that.”

She added: “I’d love to know Jess and Ruth’s view on the present state of local government, what they think the future holds – and what they think the current government’s intentions for local government are.”

It’s so pertinent this week, because this was the moment, away from Westminster, that Birmingham City Council – the city in which Electoral Dysfunction’s Jess Phillips is an MP, signed off £300m in cuts ahead of a 21% rise in council tax over two years, after declaring itself effectively bankrupt.

Financial measures described as “devastating” to people living in the city, Europe’s largest local authority could not afford to meet its financial obligations – after facing equal pay claims of up to £760m, and an £80m overspend on an under-fire IT system.

Jess, who knows the Birmingham situation all too well, talks about how councils – and this is not politically party specific – have been “massively defunded” but also says “as somebody who lives in Birmingham”, the [Labour-run] council has not been well managed.

Ruth says local government is the “bit of politics that affects people’s lives 100 per cent” and thinks the largest council in all of Europe going bust “should have been a bigger story”.

Read More:
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Budget 2024: The key announcements of Chancellor Jeremy Hunt’s speech

She also points out that Scotland’s local government is funded by Holyrood, where the row between central and local government over funding is very much live.

We are, says Jess, “sitting on a time bomb” with vulnerable children and adults struggling to access services now, that will only service to build up a bigger bill later.

Communities secretary Michael Gove last month announced a 6.5% increase in funding for local councils in England, but the £64bn settlement is unlikely to quell fears of a wave of de facto town hall bankruptcies, with the Local Government Association saying it was not enough to meet “severe pressures”.

The budget in Westminster did little to defuse this ticking time bomb on Wednesday.

The Institute for Government concluded in its budget wash up that the Conservative administration would “bequeath a dismal public services legacy to whoever wins the general election”, adding “it is also likely that more local authorities could issue section 114 [bankruptcy] notices, necessitating further painful cuts to services.”

Problems likely to be passed to Labour should they win the next general election.

But it’s going to get much harder for Westminster to ignore the continued problems of local government budgets if more council dominos continue to fall, especially in an election year.

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‘More people should be given this chance’: The probation centres transforming offenders’ lives

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'More people should be given this chance': The probation centres transforming offenders' lives

The combination of full prisons and tight public finances has forced the government to urgently rethink its approach.

Top of the agenda for an overhaul are short sentences, which look set to give way to more community rehabilitation.

The cost argument is clear – prison is expensive. It’s around £60,000 per person per year compared to community sentences at roughly £4,500 a year.

But it’s not just saving money that is driving the change.

Research shows short custodial terms, especially for first-time offenders, can do more harm than good, compounding criminal behaviour rather than acting as a deterrent.

Charlie describes herself as a former "junkie shoplifter"
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Charlie describes herself as a former ‘junkie shoplifter’

This is certainly the case for Charlie, who describes herself as a former “junkie, shoplifter from Leeds” and spoke to Sky News at Preston probation centre.

She was first sent down as a teenager and has been in and out of prison ever since. She says her experience behind bars exacerbated her drug use.

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Charlie in February 2023
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Charlie in February 2023


“In prison, I would never get clean. It’s easy, to be honest, I used to take them in myself,” she says. “I was just in a cycle of getting released, homeless, and going straight back into trap houses, drug houses, and that cycle needs to be broken.”

Eventually, she turned her life around after a court offered her drug treatment at a rehab facility.

She says that after decades of addiction and criminality, one judge’s decision was the turning point.

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“That was the moment that changed my life and I just want more judges to give more people that chance.”

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How to watch Sophy Ridge’s special programme live from Preston Prison

Also at Preston probation centre, but on the other side of the process, is probation officer Bex, who is also sceptical about short sentences.

“They disrupt people’s lives,” she says. “So, people might lose housing because they’ve gone to prison… they come out homeless and may return to drug use and reoffending.”

Read more from Sky News:
Care homes face ban on overseas recruitment
Woman reveals impact of little-known disorder

Charlie with Becks at the probation centre in Preston 
grab from Liz Bates VT for use in correspondent piece
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Bex works with offenders to turn their lives around

Bex has seen first-hand the value of alternative routes out of crime.

“A lot of the people we work with have had really disjointed lives. It takes a long time for them to trust someone, and there’s some really brilliant work that goes on every single day here that changes lives.”

It’s people like Bex and Charlie, and places like Preston probation centre, that are at the heart of the government’s change in direction.

:: Watch special programme on prisons on Politics Hub with Sophy Ridge at 7pm

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Inside the UK’s broken prison system where tinkering around the edges will no longer work

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Inside the UK's broken prison system where tinkering around the edges will no longer work

“As far as I’m concerned, there’s only three ways to spend the taxpayers’ hard-earned when it comes to prisons. More walls, more bars and more guards.”

Prison reform is one of the hardest sells in government.

Hospitals, schools, defence – these are all things you would put on an election leaflet.

Even the less glamorous end of the spectrum – potholes and bin collections – are vote winners.

But prisons? Let’s face it, the governor’s quote from the Shawshank Redemption reflects public polling pretty accurately.

Right now, however, reform is unavoidable because the system is at breaking point.

It’s a phrase that is frequently used so carelessly that it’s been diluted into cliche. But in this instance, it is absolutely correct.

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Without some kind of intervention, the prison system is at breaking point.

It will break.

Inside Preston Prison

Ahead of the government’s Sentencing Review, expected to recommend more non-custodial sentences, I’ve been talking to staff and inmates at Preston Prison, a Category B men’s prison originally built in 1790.

Overcrowding is at 156% here, according to the Howard League.

Sophy Ridge talking outside Preston Prison
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Sophy Ridge talking outside Preston Prison

One prisoner I interviewed, in for burglary, was, until a few hours before, sharing his cell with his son.

It was his son’s first time in jail – but not his. He had been out of prison since he was a teenager. More than 30 years – in and out of prison.

His family didn’t like it, he said, and now he has, in his own words, dragged his son into it.

Sophie is a prison officer and one of those people who would be utterly brilliant doing absolutely anything, and is exactly the kind of person we should all want working in prisons.

She said the worst thing about the job is seeing young men, at 18, 19, in jail for the first time. Shellshocked. Mental health all over the place. Scared.

And then seeing them again a couple of years later.

And then again.

The same faces. The officers get to know them after a while, which in a way is nice but also terrible.

Sophy Ridge talking to one of the officers who works within Preston Prison
Image:
Sophy Ridge talking to one of the officers who works within Preston Prison

The £18bn spectre of reoffending

We know the stats about reoffending, but it floored me how the system is failing. It’s the same people. Again and again.

The Sentencing Review, which we’re just days away from, will almost certainly recommend fewer people go to prison, introducing more non-custodial or community sentencing and scrapping short sentences that don’t rehabilitate but instead just start people off on the reoffending merry-go-round, like some kind of sick ride.

But they’ll do it on the grounds of cost (reoffending costs £18bn a year, a prison place costs £60,000 a year, community sentences around £4,500 per person).

They’ll do it because prisons are full (one of Keir Starmer’s first acts was being forced to let prisoners out early because there was no space).

If the government wants to be brave, however, it should do it on the grounds of reform, because prison is not working and because there must be a better way.

Inside Preston Prison, Sky News saw firsthand a system truly at breaking point - picture of a prison officer's back with HMP Preston written on it.
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Inside Preston Prison, Sky News saw first-hand a system truly at breaking point

A cold, hard look

I’ve visited prisons before, as part of my job, but this was different.

Before it felt like a PR exercise, I was taken to one room in a pristine modern prison where prisoners were learning rehabilitation skills.

This time, I felt like I really got under the skin of Preston Prison.

It’s important to say that this is a good prison, run by a thoughtful governor with staff that truly care.

But it’s still bloody hard.

“You have to be able to switch off,” one officer told me, “Because the things you see….”

Staff are stretched and many are inexperienced because of high turnover.

After a while, I understood something that had been nagging me. Why have I been given this access? Why are people being so open with me? This isn’t what usually happens with prisons and journalists.

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Probation centres answer to UK crime?

That’s when I understood.

They want people to know. They want people to know that yes, they do an incredible job and prisons aren’t perfect, but they’re not as bad as you think.

But that’s despite the government, not because of it.

Sometimes the worst thing you can do on limited resources is to work so hard you push yourself to the brink, so the system itself doesn’t break, because then people think ‘well maybe we can continue like this after all… maybe it’s okay’.

But things aren’t okay. When people say the system is at breaking point – this time it isn’t a cliche.

They really mean it.

:: Watch special programme on prisons on Politics Hub with Sophy Ridge at 7pm

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Crypto custodian BitGo secures MiCA license in Germany

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Crypto custodian BitGo secures MiCA license in Germany

Crypto custodian BitGo secures MiCA license in Germany

Goldman Sachs-backed cryptocurrency custody firm BitGo is the latest cryptocurrency company to secure regulatory approval to operate across the European Union.

Germany’s financial regulator, the Federal Financial Supervisory Authority (BaFin), granted BitGo Europe a Markets in Crypto-Assets Regulation (MiCA) license to provide digital asset services in the EU, the firm announced on May 12.

The license allows BitGo to offer services to crypto-native firms and traditional finance institutions, including banks and asset managers within the EU.

Crypto custodian BitGo secures MiCA license in Germany
Source: BitGo

“This license underscores our commitment to the highest standards of security, transparency, and trust,” BitGo Europe managing director Harald Patt said.

BitGo set up the EU headquarters in 2023

Founded in 2013 in Palo Alto, California, BitGo is a major platform in the cryptocurrency industry specializing in crypto custodial services, holding cryptocurrencies like Bitcoin (BTC) on behalf of its clients. 

BitGo’s latest regulatory milestone in Europe follows efforts to increase its presence in the EU, including establishing local headquarters in Frankfurt in 2023.

Since setting up BitGo Europe in Germany, BitGo has received multiple registrations in EU states, including Italy, Spain, Poland and Greece.

“With the MiCA license now secured, BitGo can operate across the entire EU under a unified, forward-looking regulatory framework,” the firm said in the announcement.

“Broad range of institutional-grade solutions”

BitGo did not specify the services it intends to roll out immediately under the new MiCA license.

“BitGo’s MiCA licence comes at a pivotal moment as BitGo expands its product suite to offer a broad range of institutional-grade digital asset solutions,” the announcement added.

Related: Tether CEO defends decision to skip MiCA registration for USDT

As of May 12, BaFin’s official records did not yet reflect BitGo’s MiCA license, showing only earlier registrations.

Crypto custodian BitGo secures MiCA license in Germany
BaFin data on BitGo’s registrations in Germany as of May 12, 2025, 8:30 am UTC. Source: BaFin

Cointelegraph approached BitGo for additional details on its MiCA license but did not receive a response by the time of publication.

As previously mentioned, Germany has emerged as a major jurisdiction for European businesses seeking MiCA registration, with BaFin issuing licenses to several companies, including Bitpanda and Boerse Stuttgart Digital Custody, in 2025.

Magazine: Crypto wanted to overthrow banks, now it’s becoming them in stablecoin fight

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