In connection with the above, the following documents were considered by Executive on 19 February 2025.

(5a) Revenue Monitoring P9;

(5b) Capital Programme Monitoring - P9;

(5c) Medium Term Financial Strategy and 2025/26 Revenue Budget;

(5d) Corporate Core Directorate Budget 2025/26;

(5e) Children and Education Services Budget 2025/26;

(5f) Public Health Budget 2025-28;

(5g) Adult Social Care Directorate Budget 2025-28;

(5h) Neighbourhoods Directorate Budget 2025/26 - Part 1;

(5i) Neighbourhoods Directorate Budget 2025/26 – Part 2;

(5j) Growth and Development Directorate Budget 2025/26;

(5k) Dedicated Schools Grant 2025/26;

(5l) Housing Revenue Account 2025/26 to 2027/28;

(5m) Capital Strategy and Budget 2024/25 to 2026/27;

(5n) Treasury Management Strategy Statement 2025/26.

These documents will be available to view on the Council’s website using the following link and via the Modern.Gov app:

https://democracy.manchester.gov.uk/ieListDocuments.aspx?CId=137&MId=4783&Ver=4

Due to the combined size of all the above documentation, paper copies will only be provided to Elected Members on request.

The committee considered reports of the Deputy Chief Executive and City Treasurer which provided updates on the Council’s financial position following scrutiny of the draft budget proposals and directorate budget plans by all Scrutiny Committees.

The committee received a statement from the Leader of the Council on the Executive’s budget proposals. She highlighted the impact of 14 years of government funding cuts on the Council’s ability to deliver services and the need to make difficult decisions to ensure growth and prosperity for residents. She stated that over £4.4bn additional funding had now been allocated for local government nationally and that Manchester’s share of this amounted to a 10.4% increase in core spending power as the current government recognised the importance of linking deprivation and need to budget-setting. She explained that the budget proposals were in the city’s best interests and ensured that the Council continued to listen to the concerns of residents.

The committee received a statement from the Executive Member for Finance and Resources on the Executive’s budget proposals and the key issues underlying the budget process. He commended the Senior Management Team, particularly the City Treasurer and his team, and highlighted how the budget-setting process for 2025/26 began immediately after setting the 2024/25 budget. He explained that the budget gap for 2025/26 was initially over £100m which reduced to £29m after the use of smoothing reserves, approved use of savings and assuming an increase of 4.99% in council tax and had now been closed. He highlighted the Chancellor of the Exchequer’s positive Autumn Statement in October and the Local Government Finance Settlement which increased the Council’s core spending power by 10.4% compared to a national average of 6.8% and awarded grants such as the Children’s Prevention Grant and the Recovery Grant and extra funding for social care. He advised the committee that there was a £17m overspend projected for 2024/25, largely due to demand in social care, and that the Council had recently received a rebate from the Greater Manchester Combined Authority (GMCA) Waste Reserve amounting to £5.4m. He noted that the vast majority of respondents to the budget consultation valued their neighbourhoods so the rebate would be used to award £4.6m to the Neighbourhoods service over the next three years and to address damp and mould issues in the private rented sector.

The Executive Member for Finance and Resources emphasised that the impact of 14 years of local government funding cuts on the Council and residents was ongoing but improved funding and the measures taken by the Council ensured that a balanced budget could be set for 2025/26. He noted that, despite the positive Local Government Finance Settlement, approximately 18 local authorities had asked the government for exceptional financial support and he stated that Manchester was not in this position because of responsible financial management, the prudent use of reserves and bold investment into preventative initiatives to reduce demand in people-led services.

Each Executive Member then summarised key points within the relevant directorate budget proposals. The Chair  ...  view the full minutes text for item 16.

Report of the Strategic Director (Growth and Development), Strategic Director (Neighbourhoods) and the City Treasurer

The committee received a statement from the Executive Member for Housing and Development regarding the Housing Revenue Account (HRA) calculations for 2025/26 to 2027/28 and its use.

The Executive Member for Housing and Development explained that the HRA was a ringfenced budget which was forecasted to remain in surplus in the medium-term but faced a cumulative deficit over 30 years, which work was ongoing to address. He stated that the Community Living Fund of £150k was proposed to be retained for 2025/26 to support tenants with the ongoing cost-of-living crisis. He explained that rent levels were set by a government formula of Consumer Price Inflation (CPI) + 1%, amounting to a 2.7% increase from April 2025, and it was proposed that the additional 1% rent increase be earmarked for additional borrowing to allow further capital investment in the existing housing stock to ensure all council homes meet the Decent Homes Standard and the required fire safety improvements and to tackle damp and mould in a timely manner.

There were no questions from the committee on this item.

Decision:

That the Resources and Governance Scrutiny Committee endorses the proposals as recommended for approval at Council on 28 February 2025.

[Councillor Connolly declared a pecuniary interest and left the meeting for the duration of this item].

Report of the Head of Strategic Communications and the City Treasurer.

The committee considered a report of the City Treasurer and the Head of Strategic Communications which provided a summary of the results of the 2025/26 budget and council tax consultation.

Key points and themes within the report included:

• The consultation ran for a seven-week period from 25 November 2024 to 12 January 2025;
• The consultation sought feedback from residents and businesses on:
  • The priorities and services that matter most to them.
  • A proposed 2.99% increase in council tax.
  • A proposed 2% Adult Social Care (ASC) precept.
  • General comments on the proposed savings options.
  • Proposed changes to non-residential home care charging.
• Responses were gathered via an online questionnaire on the Council’s website and paper questionnaires that were available in libraries across the city;
• A total of 1,211 people completed the online consultation survey with no paper copies of the survey returned. A further 311 people partially completed the survey;
• The questions asked and responses;
• Analysis of responses;
• Demographic analysis; and
• Equality data

There were no questions from the committee on this item.

Decision: That the report be noted.

Report of the City Solicitor and the Joint Director of Equality, Inclusion and Engagement (NHS and MCC)

The committee considered a report of the City Solicitor and the Joint Director of Equality, Inclusion and Engagement which detailed the approach to Equality Impact Assessments (EIA) and Poverty Impact Assessments that were considered in the budget setting and business planning processes

Key points and themes within the report included:

• Each service area completed an initial EIA of its savings proposal to help identify any potential negative or positive impacts, with any adverse impacts on people and communities with protected characteristics being alleviated by mitigation plans;
• The cumulative equality assessment was developed by considering city demographics, relevant data sources, and feedback from consultations and insights;
• A summary of findings in relation to the nine protected characteristics and socio-economic disadvantage; and
• The budget setting process for 2025/26 and the impact this will have on equalities and poverty.

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

• The analysis undertaken of the impact of the 4.99% increase in council tax on low-income households; and
• The measures in place to review the impact of the budget proposals on residents and how the Council would respond.

In response to queries, the Executive Member for Finance and Resources stated that there would have been a further gap of £20m in the budget if council tax was not increased by 4.99%. He recognised that the cost of living continued to impact residents and explained that there was £61m-worth of support in place, £11.3m of which constituted the Household Support Fund and £40m for council tax support.

The Leader stated that the decision to increase council tax was not taken lightly. She expressed the view that council tax was not the most effective way to increase the core spending power of an authority over time. She commented the government had been lobbied on this and that positive conversations had been held in the run up to the Comprehensive Spending Review in spring but stated that the previous government had built a 4.99% council tax increase into their base. The Leader explained that flexibility around the hardship and cost of living support enabled the Council to respond to issues and crises quickly, highlighting the example of the Winter Hardship Fund. She also noted the extension of the Household Support Fund amounting to £11m, which allowed the Council to respond further to the cost-of-living crisis for residents, and that care and support for vulnerable people was the third top priority for respondents in the budget consultation.

Decision: That the report be noted.

In addition to the above budget pack and in accordance with Council Rule of Procedure 18.3, the Committee is also required to consider any amendments to those recommendations which affect those calculations or the level of Council Tax.

The Constitution provides that amendments to Executive’s budget recommendation are to be submitted by 4:00pm on the seventh day after the meeting of Executive.

The Chair invited Councillor Leech to present his budget amendments. In doing so, Councillor Leech proposed the following:

1.     To allocate a one-off budget of £785,000 to enable the Council to deliver a £25 cost of living payment to provide a winter fuel top up payment to the 31,400 working age households in receipt of the maximum level of council tax support, to be funded through the use of £400,000 from the HFS7 contingency and £385,000 from a transfer from the General Fund Reserve. 

2a. To allocate a budget of £1,000,000 to invest additional resources into highways maintenance, to tackle the backlog of road and pavement repairs and gully repairs, to save money on future accident trip claims and to reduce the ongoing day to day maintenance costs on gully clearing and repairs; to be funded through the transfer from the Transformation Reserve.  

2b. To allocate a budget of £400,000 to invest additional resources into CCTV to tackle fly-tipping hotspots by improving detection rates and increasing enforcement and reducing instances of fly-tipping to be funded through the transfer from the Transformation Reserve.  

2c. To create a new Residents' Parking Reserve by transferring £900,000 from the on-street parking reserve, so that the fund is in place for when the Council amends its policy on not funding residents' parking schemes.  

2d. To allocate a budget of £150,000 to invest additional resources into CCTV enforcement vehicles to tackle specific parking enforcement hotspots; to be funded through the transfer from the General Fund Reserve.  

All proposals in this amendment were one-off spending commitments for 2025/2026, with a review to be carried out on the cost-effectiveness of the parking enforcement income generated by the leasing of additional CCTV enforcement vehicles. 

Councillor Leech also placed on record his thanks to the City Treasurer and his team for their help and guidance.

The Chair queried whether the Residents Parking Reserve was proposed to be established and used specifically in the proposer’s own ward of Didsbury West. In response, Councillor Leech confirmed that the proposed reserve was not intended solely for Didsbury West. He recognised the Council’s current policy of not funding resident parking schemes and that the proposal was to establish a reserve so that funding was available for a scheme anywhere in the city in the event that this policy was reversed.

Decision:

That the committee does not endorse the amendment proposed by Councillor Leech to Council.