Section 114 notice

Section 114 notices are reports issued by the chief financial officer (or Section 151 officer) of a British public body to prevent certain types of expenditure. The notices take their name from section 114 of the Local Government Finance Act 1988.

The most common type of notice is made under section 114(3) which restricts all spending except for that which funds statutory services. Despite the fact that local authorities in the United Kingdom cannot go bankrupt, issuing a section 114 notice 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.

Amongst other instances, section 114 notices have been issued by Hackney Council in 2000, Northamptonshire Council twice in 2018, Croydon Council in 2020 and 2022, Slough Council in 2021, Thurrock Council in 2022, and Woking Borough Council and Birmingham City Council in 2023.