As a small individual I was mostly taught that bankruptcy is like having a slur against ones name.
So, how come these big public funded councils are "going bankrupt"?
What exactly does it mean?
Does it mean that the big councils will be given a fresh new start without having to pay the bills of the smallest suppliers? |
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By (user no longer on site)
over a year ago
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As a Birmingham resident I am guessing it means that exactly the same Councillors and employees will continue to run the Council in the same way, but they will increase Council tax by 10% rather than 5%.
So no change at all really aside from Birmingham residents will just be paying more to the same useless people. |
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These councils will carry on as normal under section 14, it just means if you supply a service or goods to the council you can not stop supplying the service or goods even though as a company you are not going to get paid. |
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"These councils will carry on as normal under section 14, it just means if you supply a service or goods to the council you can not stop supplying the service or goods even though as a company you are not going to get paid."
Good answer!
I think this answer is similar to my original question! |
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By *ild_oatsMan
over a year ago
the land of saints & sinners |
"These councils will carry on as normal under section 14, it just means if you supply a service or goods to the council you can not stop supplying the service or goods even though as a company you are not going to get paid."
It’s actually a Section 114 notice.
From section 114 of the Local Government Finance Act 1988.
Local authorities in the United Kingdom cannot go bankrupt but by issuing a section 114 notice it is often described in the media as a council effectively declaring bankruptcy.
Most councils under a section 114 notice will then pass a new budget to introduce cuts and reduce spending.
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It's an interesting point, and linked to a similar thread discussing whether state pensions are a Ponzi scheme. The answer to both is no, because even though governments may be insolvent, they enjoy powers of revenue collection via taxation. |
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