Today is a day that we all knew has been coming and I think it is fair to say that it is a day that no one in this Chamber or the City has been looking forward to. Over the last 12 months I have lived and breathed this budget and believe me when I say, it doesn’t become any easier over time. It has had an impact on Councillors and officers, not only because of the enormity of the challenge but because we care and we know the impact this budget will have on the people and the City we serve.

So I start by paying tribute to the officers. To Becky Hellard and her team. To the CEO Ged Fitzgerald and all the staff who have worked so hard on helping prepare this budget and to the Trade Unions and the entire workforce who have understood and recognized the position we have been placed in.

Our staff do a tremendous job and have been called upon to do more with less over the last three years and they are now being asked again to do more, in difficult circumstances. I also pay tribute to my Cabinet and all the Councillors who have engaged and worked with us to try to manage the financial nightmare imposed on us by this coalition Government.

Liverpool City Council is without a doubt facing the most difficult period in its long history. We’re facing £156m of cuts over the next three years on top of the £176m that we’ve already had to suffer. This means that Liverpool is facing a 58% reduction in Government grants. Reductions imposed by a Government made up of millionaire Ministers far removed from reality, who are more interested in attacking the poorest and the weakest in society than looking for a fairer solution. It is those very same millionaires who are making the weak and poor pay for the bonuses and tax cuts for the rich. All of which is being aided and abetted by the parasites of politics, the Liberal Democrats.

Only this morning David Cameron compared Liverpool to his own leafy southern constituency of Witney in Oxfordshire stating “Liverpool is being properly funded for the services they need” and he does “not believe that Liverpool is being short changed.”

What ignorance, what arrogance. The very idea that I want to cut services to the people who elected me is as obscene as it is stupid. There are two points being made and one of us is lying, the people of this City who are facing these cuts know who that is.

It is no secret that these cuts are going to have a devastating impact on our City. They will affect every single service provided by the council and every single person in the City will notice or be impacted in some way or other. We are facing the biggest financial challenge this City has ever had to face in its entire history. Forget post-second world war, forget what happened in the eighties – these cuts are far, far worse than any of those challenges.

However I did not become Mayor of this great city to implement such devastating cuts that have a detrimental effect on people’s lives and services. But I did become Mayor to lead this City and to act on behalf of its people. I became Mayor knowing I had to make hard decisions, the right decisions at the right time and to take this City forward.

That is why, with a heavy heart, I bring this budget to you tonight. Asking you to endorse the cruelest and toughest budget ever set within this City but with my commitment that the savings and reductions we are being forced to make will be done in the fairest way possible.

Since the cuts were announced by the government I have fought them and asked for one thing only – to assess us fairly and treat us equally. I have remained transparent throughout and I have made my thoughts known and my voice heard to everyone who was willing to listen. Unfortunately, this government wasn’t willing to listen. This government isn’t interested in fairness. How can it be? When we know the City identified as the most in need is the one that suffers the most in the cuts.

I’ve explained time and time again, to audiences across the country, how Liverpool will be affected by the cuts we’re facing from this Government.

I have heard from service users, residents and staff about the devastating impact the cuts are having and will have on their lives. Their stories are heart breaking, but I’m sad to say, they weren’t surprising.

They weren’t surprising because the brunt of the Government’s deficit reduction programme has been targeted at Local Government and this has then resulted in harmful cuts to those most in need.

Adding further pain are the welfare reforms, which in clear simple terms, is the state punishing the poor. These are not rhetoric anti-Government words or opposition attacks. These are words based on evidence backed by leading academics, faith leaders and others. There is no hiding from the fact that the poor are paying the heaviest price in this so called economic crisis. Those most in need are suffering while those most in greed are benefitting.

The rich are getting richer with tax cuts, pay hikes, bonuses and state subsidies. Meanwhile the poor are suffering from wage repression, cuts and loss of essential services. The policies of this Government are creating an economic apartheid in Cities and towns across the Country. It is our City and others that are bearing the brunt of the cuts and as a result, youth centres will close. Children’s centres will close. Libraries, leisure centres, and day centres will all face closure.

Programmes helping the sick, the elderly, the vulnerable and the frail, will have to be reduced or cease. Schemes designed to help victims of domestic abuse, victims of rape, victims of substance abuse will all face being withdrawn.

This is not scaremongering. These are the effects to ordinary people here in Liverpool, our own local paper the Echo got it right when it declared in a leader column recently “our City is under attack” and this Government are putting the boot in. The Echo are absolutely right.

But the sad fact is that these cuts are self-defeating. They won’t help rebalance Britain’s economy. They will simply entrench the inequality that caused Britain’s economy to become unbalanced in the first place. They won’t stop people relying on help. They will simply push those people further into dependency or into despair.

There are enough independent reports exposing the facts that the funding distribution is impacting hardest on those most in need and is simply not fair and equitable.

And I say this to my Party, the Labour Party nationally, wake up. Wake up to the pain and damage that is being done and if not halted and reversed will cause lasting damage and take years to put right, to look urgently at plans and policies that can change and shape Cities economies, so they can do more to sustain themselves now and in the future. There needs to be an urgent and honest assessment done independently, a form of arbitration to look at Local Government funding which addresses the unfairness of Local Government finances.

This coalition Government will not listen nor accept that everyone speaking out can’t be wrong, when we say what is happening is not fair. But when you take away 58% of our funding… When you force us to cut £176million in three years, and then cut another £156 million in the next three. When you keep coming back time after time, cutting more funding, causing more pain, and more hardship on ordinary people, and when you refuse to listen, you add insult to injury. You cause alienation.

It is clear that we are in this on our own. There will be no white charger over the hill to come and save us. We have been dealt our cards and it is up to us to arrange them in whatever way we can. It is up to me as Mayor and all of us in this chamber, regardless of political affiliation; to work together in order to get through what is going to be a very challenging time.

I simply can’t stand by and let this happen and I won’t let the most disadvantaged and vulnerable people suffer. People who need the council to provide basic needs and support, but we will have to make tough choices and prioritise the limited money we have.

That’s why last year I made sure that when the government scrapped council tax benefit, taking out £6m from our budget affecting families on the lowest income, unlike other Councils I put £1.7m into the pot to minimise the impact of the government cuts. As a result, instead of low income families being forced to pay an extra £140 council tax, their payments were cushioned to around £65 – which could mean the difference between turning on the heating in winter or being able to buy food for their children.

That’s why for next year, and for 2 years after that, I’ve put that amount of money back into the budget to ensure that those families are still protected against the government’s cuts whilst I’m Mayor of this city.

That’s why I set up a Poverty Task Group and backed it up with £400,000 to help Liverpool’s working families who are suffering most from the impact of the austerity and welfare reform measures.

Through this we were able to take that money and put it to good use. Amongst other things we set up a Play Healthy Fund which fed over 9,000 children and families over the school holidays.

That’s why I supported Credit Unions with £1m so families aren’t forced into the misery of loan shark debt. That’s why I put £1.2 million into the neighborhood fund to help projects schemes helping in communities and that’s why we are funding it again this year.

That’s why I set up a charity – the Mayor’s Hope Fund – supporting foodbanks in this city with £150,000 because they can’t keep up with the demand for their services.

That’s why in October of this year, I announced that every City Council employee will be earning no less than the living wage.

This City Council is leading the way to tackle in-work poverty and supporting those families on the lowest income.

Let me be absolutely clear – these challenges will be overcome, if we grasp the opportunities, if we are willing to keep an open mind, think differently and be prepared to do things differently, efficiency can be the driver of our most innovative ideas.

We can begin to break down old ways of thinking and create a determination to get through the tough times we face. We need to do things that create growth and encourage business, we need to be more imaginative and creative, investing to save and investing to earn.

The cuts we are facing as a Council are forcing us to completely re-invent what we are here to do.

If we want to keep hold of services, if we want events, if we want to spend money on our young people, our old people, safer, cleaner and greener communities then we have to generate the funding to do it and we have to be resilient and imaginative in what we do.

I have said many a time that this is like Charles Dickens’ Tale of Two Cities – “the best of times, the worst of times” because there is another side of the coin that that this Government and others can’t ignore. The fact is, Liverpool today is a thriving City. A City that is a confident and exciting place, a place buzzing with excitement about its future which is sound and secure.

We are a city that is rebuilding itself after years of difficulty. We are overcoming the challenges we face, and we are seizing the opportunities we have. As we speak over a £1billion is being spent in our City and confidence and investment is happening.

I firmly believe Liverpool is becoming once again a City with a bright future, one that can proudly claim to be a global City. But our recovery is fragile. It still needs to be nurtured.

We are finding new ways of moving away from dependency to become a more sufficient City, to be able to be more entrepreneurial and use our strengths to our advantage.

We will stand up and be counted and we will continue to drive the City forward in a sustainable way. We have come a long way but the journey is by no means complete.

A successful City is one that is in charge of its own destiny; a city that can achieve financial self-sufficiency and perform beyond the nation economic average is what we want, what I want, for Liverpool.

We need to think about strategic Investment – What we spend and how we invest it. How we use our borrowing strengths and reserves in a way that stimulates investment and acts as a lever to draw in private sector funding, creating new businesses and creating jobs – which is the most important thing for me.

We need to invest to earn. With investments such as Finch Farm and the Cunard building bringing in revenue and a financial gain we will soon be making money back – money that we will be able to spend on services for our City and its people.

These cuts are going to make things very difficult – there is no doubt about that. But together we will get through it and together we will move forward.

I am incredibly proud to be Mayor of Liverpool. This is not only my home but it is the home of my children and Grandchildren. I will continue to do everything I can for the City and its people.

There is no doubt in my mind that the best days lay ahead for Liverpool. Despite their best efforts, this Lib Dem/Tory Government will not knock us down. Liverpool will continue to grow and continue to be the envy of the world.

No other City has what we have, our values and our determination to stand up for each other, or our desire to see fairness and justice. Our pride in our City and our willingness to help each other mean that we will get through this together. We will stand side by side and together we will move forward to regain our place as the best City in the world.

I move the budget before you.

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