To allow Members an opportunity to [a] declare any personal, prejudicial or disclosable pecuniary interests they might have in any items which appear on this agenda; and [b] record any items from which they are precluded from voting as a result of Council Tax/Council rent arrears; [c] the existence and nature of party whipping arrangements in respect of any item to be considered at this meeting. Members with a personal interest should declare that at the start of the item under consideration. If Members also have a prejudicial or disclosable pecuniary interest they must withdraw from the meeting during the consideration of the item.

Councillors Kilpatrick, Lanchbury and Stogia declared personal interests in item 5 – Annual Property Report.

To approve as a correct record the minutes of the meeting held on 9 November 2023.

Decision:

That the minutes of the meeting held on 9 November 2023 be approved as a correct record.

Report of the Deputy Chief Executive and City Treasurer and the Strategic Director (Growth and Development).

This report provides an update on property activity since the last Annual Property Report to Resources and Governance Scrutiny Committee in September 2022.

The committee considered a report of the Deputy Chief Executive and City Treasurer and the Strategic Director (Growth and Development) which provided an update on property activity since the previous update to the committee in September 2022.

Key points and themes within the report included:

• Progress made and initial activity of the Strategic Asset Management Plan (SAMP) including the Asset Review and governance;
• The work of the Council’s Development Team and Investment Estate in delivering against the Council’s objectives for residential and employment growth;
• A decision not to retender the contract for property management of the Council’s investment estate to Jacobs UK Ltd.;
• Significant developments across the city;
• An update on the Council’s operational estate, comprised of approximately 350 assets used by the Council to deliver services;
• The work of the Facilities Management service;
• The Zero Carbon Estates Programme;
• The Council’s Property Asset Database (CPAD);
• An update on the Our Town Hall project; and
• The use of agency staff.

Some of the key points and queries that arose from the committee’s discussions included:

• Welcoming the redevelopment of the Church Street car park, and querying whether the disposal of this meant that the Council would no longer have ownership for this land;
• Highlighting the need for member involvement in the redevelopment of Church Street car park and the importance of retaining the war memorial there;
• If there would be enough car parking in the city centre if the Church Street car park was redeveloped;
• Requesting further information on the Parks Buildings Strategic Group and potential opportunities for buildings in parks;
• The need to understand the implications on the Council’s financial position of the return in investment from Manchester Airport;
• Welcoming changing places in parks and the social value work across the property service;
• How much priority was given to maintaining council-owned land;
• What was meant by ‘surplus assets’;
• How members were involved in the use and purchase of Council-owned land in their wards;
• If the SAMP Board members had the right skills and knowledge in estates management to ensure a maximum return on investments;
• Recognising the Council was awarded Levelling Up funding for Wythenshawe and commending those involved in this;
• Requesting more information on the1,800 peppercorn leases in the Council’s investment portfolio and how these could be viewed on CPAD;
• The vacancy rate amongst council-owned land and properties;
• Whether banks could use surplus space in local libraries across the city;
• Noting that several projects started when interest rates were low, and how viable these schemes were now given the increase in interest rates;
• The quality of early years buildings;
• Whether the Council’s website should be amended to reflect that the Town Hall would not reopen in 2024; and
• Why officers were confident in their ability to reduce the requirement for agency staff and to recruit full-time staff.

The Statutory Deputy Leader introduced the report and emphasised the establishment of the SAMP Board, which provided a cohesive and coordinated approach to the Council’s estates and developments. He stated that the Council  ...  view the full minutes text for item 68.

Report of the Deputy Chief Executive and City Treasurer.

This report provides an update on the impact of recent changes in financial and construction markets on the capital programme and provides an update on the proposed capital budget process for 2024/25. The report also highlights the increased Government and public scrutiny of council capital programmes and borrowing approaches, following the issuing of several Section 114 notices as a result of poor capital investment decisions.

The committee considered a report of the Deputy Chief Executive and City Treasurer which provided anupdate on the impact of recent changes in financial and construction markets on the capital programme and an update on the proposed capital budget process for 2024/25. It also highlighted the increased Government and public scrutiny of Council capital programmes and borrowing approaches, following the issuing of several Section 114 notices as a result of poor capital investment decisions.

Key points and themes within the report included:

• Providing an introduction and background to the capital budget update;
• The Council’s current balance sheet position, including external debt and capital financing requirement;
• A renewed focus across the local government sector on financial sustainability;
• The current approved Capital Programme and its capacity;
• How the Programme was being financed; and
• The proposed financing and budget approaches.

Some of the key points and queries that arose from the committee’s discussions included:

• If the increased scrutiny of local authorities was driven by the publication of Section 114 notices by some local councils;
• The support provided by the Office for Local Government (OFLOG);
• The probability of having to end capital programme projects and how this is monitored;
• How the drawdown of reserves and being cautious would impact the CRF and future capital investment;
• Whether the current forecast for the approved capital programme table would be updated to reflect budget increases for the Town Hall refurbishment and any other programme;and
• The approach to the Minimum Revenue Provision (MRP) and how this would sustain unforeseen increases in borrowing.

The Deputy Chief Executive and City Treasurer introduced the report and highlighted the increased scrutiny of local authorities’ borrowing activity and that this would be looked at in more detail following the establishment of OFLOG. She also assured the committee that work was underway on the shape of the capital programme for the next 5 years and how this would balance investment in infrastructure, external funding and the scope for new investment priorities.

In response to a query from the Chair, the Deputy Chief Executive and City Treasurer stated that the increased scrutiny of local government recognised concerns over the high levels of borrowing and Joint Ventures in some local authorities which did not necessarily have the resources or expertise to correctly manage risk.

The committee was advised that OFLOG was still developing their approach and capacity to provide support, but it would try to encourage a culture of early intervention to identify warning signs and signpost authorities to expertise and support. OFLOG would identify a suite of metrics, such as levels of borrowing, to highlight areas for further discussion.

The Deputy Chief Executive and City Treasurer stated that the Council would only take on new borrowing if it was clear and strategically aligned to a Council priority and an invest-to-save approach was currently being assessed. She provided assurances that none of the capital programme projects would be cancelled currently as all schemes were affordable and officers continued to review the capital programme.

It  ...  view the full minutes text for item 69.

Report of the Deputy Chief Executive and City Treasurer.

This report focuses on the announcements from the government’s Autumn Statement which have a direct implication for local government funding next year and in future years.

The committee considered a report of the Deputy Chief Executive and City Treasurer whichhighlighted the announcements from the Government’s Autumn Statement which have a direct implication for local government funding next year and future years.

Key points and themes within the report included:

• The Chancellor of the Exchequer, Jeremy Hunt MP, delivered the Government’s Autumn Statement (mini budget) to the House of Commons on 22 November 2023 and this was structured around reducing debt; cutting tax and rewarding hard work; and backing British business;
• The Autumn Statement and main Spring Budget announcements do not provide exact funding updates for Local Government, but provide important indicators as to the outlook for council funding and allow this information to be used to inform the medium-term financial plan and budget process;
• Further detail on the Local Government position was expected in early December when a policy document will be released by the Department for Levelling Up, Housing and Communities (DLUHC), and in late December when the provisional settlement with LA allocations would be published;
• The economic and fiscal forecasts published by the Office for Budget Responsibility alongside the Autumn Statement;
• There would be no increase in the overall funding envelope over the Spending Review period and no additional funding was announced for local authorities beyond the increases already expected;
• Announcements indirectly affecting residents included a rise in National Living Wage; the unfreezing of Local Housing Allowance (LHA); a rise in benefits; protection of the pensions ‘triple-lock’; a decrease in the rate of National Insurance; and changes to national insurance for self-employed people;
• The continuation of business rates retention arrangements for Greater Manchester under the Devolution Trailblazer;
• Medium-term implications; and
• The provisional settlement outcome and revised position will be reported to the committee and the Executive in January to consider the longer-term position.

Some of the key points and queries that arose from the committee’s discussion included:

• Whether it had been confirmed that the Household Support Fund (HSF) would not continue in 2024/25;
• If HSF funded free school meals and the Holiday Activity Fund scheme, and how these schemes would be funded if HSF ended;
• Noting that the Council received £12.9m in HSF, and querying whether any representations had been made to government to ask that this be continued; 
• Noting the rise in National Living Wage in April 2024, and querying whether this increase would be implemented regardless of any other staff pay deal;
• Noting the importance of communicating any changes in Local Housing Allowance and the relevant Universal Credit aspect of housing support;
• The possibility of there being a period where employees would need to receive a pay uplift to meet the Real Living Wage whilst an agreed pay award was being implemented; and
• Most residents in Manchester would not feel the benefit of tax cuts set out in the Autumn Statement due to the freezing of the income tax threshold and the cost-of-living crisis.

The Executive Member for Finance and Resources stated that the Chancellor’s Autumn Statement made no reference to  ...  view the full minutes text for item 70.

Report of the Deputy Chief Executive and City Treasurer, the Strategic Director (Growth and Development) and the Strategic Director (Neighbourhoods).

This report presents members with an update on the proposed Housing Revenue Account (HRA) budget for 2024/25 and sets out the key assumptions being used in developing the next year’s budget and the outlook for the 30-year HRA business plan in light of the budget proposals.

The committee considered a report of the Deputy Chief Executive and City Treasurer, the Strategic Director (Neighbourhoods) and the Strategic Director (Growth and Development) which presented an update on the proposed Housing Revenue Account (HRA) budget for 2024/25 and set out the key assumptions being used in developing the next year’s budget and the outlook for the 30-year HRA business plan in light of the budget proposals.

Key points and themes within the report included:

• The proposed rent increase for 2024/25 was 7.7%;
• The current budget position for the HRA as at period 6, with a forecasted overspend of £2.879m;
• The current budget assumptions for 2023/24, including rental income;
• There was no indication in the government’s recent Autumn Statement that a rent cap would be applied as it had for 2023/24;
• Management of housing stock and property numbers;
• Other income and Private Finance Initiative (PFI) schemes;
• Communal heating and a proposal to increase the tariffs to residents in line with the price cap as set by Ofgem from 1 January 2024 which would be reviewed in April 2024 when the next price cap announcement was due;
• Debt financing and borrowing costs;
• Capital investment;
• The overall reserves position forecast; and
• Recognising the difficulties faced by tenants in light of the current cost of living crisis, whilst seeking to balance the need to have a balanced HRA business plan.

Some of the key points and queries that arose from the committee’s discussions included:

• If consideration had been given to lengthening the business plan to 35 or 40 years, as a result of increased interest rates;
• Whether a rent increase cap would be implemented for 2024/25 as it had been for the current year and, if so, how this would affect the HRA budget;
• Whether planning changes announced in the Autumn Statement would impact retrofitting and the installation of heat pumps;
• Challenges with access to properties and how this affected the project repairs percentage;
• How future risk and changes, such as in fire safety measures, were factored into the business plan;
• The assessment undertaken in the decision not to bring the housing repairs contact in-house;
• Welcoming the reduction in the number of void properties;
• The cap on the number of properties the Council could purchase;
• If Private Finance Initiative (PFI) housing stock was subject to Right-to-Buy, and whether this was excluded from current assumptions of the Council’s future housing stock;
• Whether there would be any communication with residents in communal heating schemes about proposed increases to tariffs in line with the price cap as set by Ofgem from 1st January 2024;
• Whether any consideration had been given to moving to individual heating schemes, as opposed to communal schemes, to give residents more control over their usage and bills; and
• If there were any issues with non-payment of communal heating charges.

The Executive Member for Housing and Development introduced the item and explained that the HRA was a ringfenced account for the Council’s housing services and the report outlined the long-term 30-year business plan  ...  view the full minutes text for item 71.

Report of the Deputy Chief Executive and City Treasurer.

This report advises on the methodology of calculating the City Council's council tax base and business rates income for budget setting purposes for 2024/25, along with the timing of related payments and the decision on business rates pool membership. In line with previous years, the Chair of the Committee is requested to exempt various key decisions from call-in.

The committee considered a report of the Deputy Chief Executive and City Treasurer whichadvised on the methodology of calculating the council tax base and business rates income for budget setting purposes for 2024/25 and detailed the timing of related payments and the decision on business rates pool membership.

Key points and themes within the report included:

• The Council has a statutory duty to agree the 2023/24 estimated council tax surplus or deficit by 15 January 2024; set the 2024/25 council tax base by the 31 January 2024; agree the 2023/24 estimated business rates surplus or deficit by 31 January 2024; and set the 2024/25 business rates base by the 31 January 2024;
• The calculation of the council tax base is the number of dwellings within the Council’s boundary presented as ‘Band D equivalent’;
• Under the Levelling Up and Regeneration Bill, from 1 April 2024 authorities can apply a 100% premium on unoccupied, empty and unfurnished properties after one year. This will be included in the 2024/25 tax base calculation and is estimated to generate an additional £0.8m;
• Retained business rates income remains protected and all Greater Manchester authorities, under the 100% Trailblazer Deal, are guaranteed 97.0% of their baseline funding level; and
• Requesting that the Chair of Resources and Governance Scrutiny Committee approves the exemption of various related Key Decisions from the call-in process.

Decision:

That the committee

1.    notes that the Deputy Chief Executive and City Treasurer, in consultation with the Executive Member for Finance and Resources, has delegated powers to:

·         agree the estimated council tax surplus or deficit for 2023/24;

·         set the 2024/25 council tax base for tax setting purposes in accordance with the Local Authorities (Calculation of Council Tax Base) (England) Regulations 2013;

·         agree the estimated business rates surplus or deficit for 2023/24;

·         calculate the 2024/25 business rates income for budget setting purposes in accordance with the Non-Domestic Rating (Rates Retention) Regulations;

·         determine whether the Council should be part of a business rate pooling arrangements with other Greater Manchester local authorities in 2024/25;

·         set the dates of precept payments to the Greater Manchester Combined Authority in 2024/25.

2.    notes that the Chair of the Resources and Governance Scrutiny Committee will be requested to exempt various key decisions from the call-in procedure.

Report of the Governance and Scrutiny Support Unit.

This report provides the Committee with details of key decisions that fall within the Committee’s remit and an update on actions resulting from the Committee’s recommendations. The report also includes the Committee’s work programme, which the Committee is asked to amend as appropriate and agree.

The committee received a report of the Governance and Scrutiny Support Unit which provided details of key decisions that fell within the Committee’s remit and items for information previously requested by the Committee. The report also included the Committee’s work programme, which the Committee was asked to amend as appropriate and agree.

A query was raised regarding an outstanding recommendation that a more substantial report on Major Contracts be provided at the next update and that this included an appendix with more detailed information on each major contract and whether insourcing would be viable. Officers endeavoured to bring a report on this in March 2024.

Decision:

That

1. the report be noted, and
2. the work programme agreed with an update report on major contracts considered by the committee in March 2024.