Birmingham City Council, Europe's largest local authority, has effectively declared bankruptcy, confirming in a statement that all new spending except for protecting vulnerable people and statutory services, must stop immediately.

But how does a council go bust?

On the Sky News Daily, Niall Paterson is joined by our politics and business correspondent Mhari Aurora, as well as Iain Murray from the Chartered Institute of Public Finance and Accountancy, who explains how a council can run out of money.

Plus, Sarah Hayward shares her experiences working as part Slough Council's senior leadership team, a role she came into a year after its recovery from bankruptcy.

Producer: Soila Apparicio
Interviews Producer: Melissa Tutesigensi
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Editor: Philly Beaumont