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Labour will not bail out bankrupt councils, the shadow chancellor has said.

“I’m not going to be able to fix all the problems straightaway,” Rachel Reeves said during an interview on Sky News’ Sunday Morning With Trevor Phillips.

Her comments follow Birmingham City Council effectively declaring bankruptcy after being hit with a £760m bill to settle equal pay claims.

In response, the council approved plans to hike council tax by 21% over the next two years, as well as £300m in cuts over the same period.

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Watch the full interview

Asked if she would bail out the councils, allow them to raise taxes or tell them to sink or swim, Ms Reeves said: “I’m under no illusions about the scale of the challenge that I will inherit if I become chancellor later this year and I need to be honest with people.”

She added: “My focus is on reforming the planning system to get Britain building again…

“If we do those things, we will bring in the tax revenue and we will be able to invest in public services again. There’s no shortcuts. That is the way.”

During the Sky News interview, Ms Reeves also said scrapping the non-dom tax status is “an utter humiliation for this government”.

“The last budget of this parliament – they’ve had 14 years and they use this moment to close a non-dom tax loophole that everyone has been aware of for years,” she added.

Shadow chancellor Rachel Reeves and Labour leader Sir Keir Starmer. Pic: PA
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Shadow chancellor Rachel Reeves and Labour leader Sir Keir Starmer. Pic: PA

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Other councils have effectively declared bankruptcy

Several other councils have effectively declared bankruptcy, with Hackney Council issuing a section 114 notice in 2000 and Northamptonshire County Council following suit in 2018.

Croydon Council issued its third section 114 notice in two years in November 2022. Thurrock in Essex made the same move in December 2022 after it got into difficulties over borrowing large sums to invest in solar energy.

Woking issued a section 114 in June 2023 due to what it said was “an extremely serious financial shortfall owing to its historic investment strategy that has resulted in unaffordable borrowing, inadequate steps to repay that borrowing and high values of irrecoverable loans”.

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‘Shameful’ that black boys in London more likely to die than white boys, says Met Police chief

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'Shameful' that black boys in London more likely to die than white boys, says Met Police chief

It is “shameful” that black boys growing up in London are “far more likely” to die than white boys, Metropolitan Police chief Sir Mark Rowley has told Sky News.

The commissioner told Sunday Morning with Trevor Phillips that relations with minority communities “is difficult for us”.

Sir Mark, who came out of retirement to become head of the UK’s largest police force in 2022, said: “We can’t pretend otherwise that we’ve got a history between policing and black communities where policing has got a lot wrong.

“And we get a lot more right today, but we do still make mistakes. That’s not in doubt. I’m being as relentless in that as it can be.”

He said the “vast majority” of the force are “good people”.

However, he added: “But that legacy, combined with the tragedy that some of this crime falls most heavily in black communities, that creates a real problem because the legacy creates concern.”

Sir Mark, who also leads the UK’s counter-terrorism policing, said it is “not right” that black boys growing up in London “are far more likely to be dead by the time they’re 18” than white boys.

“That’s, I think, shameful for the city,” he admitted.

The Met Police chief’s admission comes two years after an official report found the force is institutionally racist, misogynistic and homophobic.

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Police chase suspected phone thief

Baroness Casey was commissioned in 2021 to look into the Met Police after serving police officer Wayne Couzens abducted, raped and murdered Sarah Everard.

She pinned the primary blame for the Met’s culture on its past leadership and found that stop and search and the use of force against black people was excessive.

At the time, Sir Mark, who had been commissioner for six months when the report was published, said he would not use the labels of institutionally racist, institutionally misogynistic and institutionally homophobic, which Casey insisted the Met deserved.

However, London Mayor Sadiq Khan, who helped hire Sir Mark – and could fire him – made it clear the commissioner agreed with Baroness Casey’s verdict.

After the report was released, Sir Mark said “institutional” was political language so he was not going to use it, but he accepted “we have racists, misogynists…systematic failings, management failings, cultural failings”.

A few months after the report, Sir Mark launched a two-year £366m plan to overhaul the Met, including increased emphasis on neighbourhood policing to rebuild public trust and plans to recruit 500 more community support officers and an extra 565 people to work with teams investigating domestic violence, sexual offences and child sexual abuse and exploitation.

Watch the full interview on Sunday Morning with Trevor Phillips from 8.30am on Sunday.

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Unite votes to suspend Angela Rayner over Birmingham bin strike

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Unite votes to suspend Angela Rayner over Birmingham bin strike

Labour’s largest union donor, Unite, has voted to suspend Deputy Prime Minister Angela Rayner over her role in the Birmingham bin strike row.

Members of the trade union, one of the UK’s largest, also “overwhelmingly” voted to “re-examine its relationship” with Labour over the issue.

They said Ms Rayner, who is also housing, communities and local government secretary, Birmingham Council’s leader, John Cotton, and other Labour councillors had been suspended for “bringing the union into disrepute”.

There was confusion over Ms Rayner’s membership of Unite, with her office having said she was no longer a member and resigned months ago and therefore could not be suspended.

But Unite said she was registered as a member. Parliament’s latest register of interests had her down as a member in May.

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The union said an emergency motion was put to members at its policy conference in Brighton on Friday.

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Unite is one of the Labour Party’s largest union donors, donating £414,610 in the first quarter of 2025 – the highest amount in that period by a union, company or individual.

The union condemned Birmingham’s Labour council and the government for “attacking the bin workers”.

Mountains of rubbish have been piling up in the city since January after workers first went on strike over changes to their pay, with all-out strike action starting in March. An agreement has still not been made.

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Rat catcher tackling Birmingham’s bins problem

Ms Rayner and the councillors had their membership suspended for “effectively firing and rehiring the workers, who are striking over pay cuts of up to £8,000”, the union added.

‘Missing in action’

General secretary Sharon Graham told Sky News on Saturday morning: “Angela Rayner, who has the power to solve this dispute, has been missing in action, has not been involved, is refusing to come to the table.”

She had earlier said: “Unite is crystal clear, it will call out bad employers regardless of the colour of their rosette.

“Angela Rayner has had every opportunity to intervene and resolve this dispute but has instead backed a rogue council that has peddled lies and smeared its workers fighting huge pay cuts.

“The disgraceful actions of the government and a so-called Labour council, is essentially fire and rehire and makes a joke of the Employment Relations Act promises.

“People up and down the country are asking whose side is the Labour government on and coming up with the answer not workers.”

SN pics from 10/04/25 Tyseley Lane, Tyseley, Birmingham showing some rubbish piling up because of bin strikes
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Piles of rubbish built up around Birmingham because of the strike over pay

Sir Keir Starmer’s spokesman said the government’s “priority is and always has been the residents of Birmingham”.

He said the decision by Unite workers to go on strike had “caused disruption” to the city.

“We’ve worked to clean up streets and remain in close contact with the council […] as we support its recovery,” he added.

A total of 800 Unite delegates voted on the motion.

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance co-founder CZ has dismissed a Bloomberg report linking him to the Trump-backed USD1 stablecoin, threatening legal action over alleged defamation.

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