Manchester City Council

Agenda and minutes

Agenda and minutes

Resources and Governance Scrutiny Committee
Thursday, 6th December, 2018 2.00 pm

Venue: Council Ante Chamber, Level 2, Town Hall Extension

Contact: Michael Williamson 

Webcast: View the webcast

Items
No. Item

64.

Minutes pdf icon PDF 168 KB

To approve as a correct record the minutes of the meeting held on 8 November 2018

Additional documents:

Minutes:

The minutes of the meeting held on 8 November 2018 were agreed as a correct record.

65.

The Chancellor's Autumn Statement - implications for Manchester pdf icon PDF 368 KB

Report of the City Treasurer

 

This report provides an overview of the key announcements within the Chancellor of the Exchequer’s 2018 Autumn Budget outlining the Government’s fiscal agenda, and the implications for Manchester.

Additional documents:

Minutes:

The Committee considered a report of the City Treasurer, which provided an overview of the key announcements within the Chancellor of the Exchequer’s 2018 Autumn Budget outlining the Government’s fiscal agenda, and the implications for Manchester.

 

Officers referred to the main points and themes within the report which included:-

 

·                The 2018 Autumn Budget set out an improved economic forecast and indicative increased public sector spending over the next five years;

·                Government expenditure was now expected to grow at 1.2% per year in real terms from 2019-20 onwards (contrasted to an average cut in real-term funding in the 2015 Spending Review of -1.3%);

·                The 2019 Spending Review would decide on the balance of funding between government departments, however, it was already clear that much of the additional spend would be directed to the NHS, with spending in other departments likely to remain flat or decline;

·                Should the government be unable to reach a Brexit deal with the EU, there could be an upgrade the 2019 Spring Statement to a full fiscal event, which could include further tax or borrowing measures;

·                There were announcements for additional Local Government funding this financial year and next.  Whilst welcome, they were small and unlikely to have a fundamental impact on the Council’s budget strategy for 2019/20, however, the additional Social Care funding could meet some of the pressures faced;

·                Specific allocations announced and the associated funding for Manchester which included:

·                a further £240m in 2019/20 for adult social care which equated to £2.667m for each year for Manchester - this followed the allocation of a similar amount in 2018/19;

·                £410m Social Care grant in 2019/20 for adults and children’s social care, Manchester’s indicative amount was £4.555m;

·                £420m in 2018/19 for potholes that would be allocated directly to highways authorities and must be spent prior to 31 March 2019.  The allocation for Manchester was £1.686m;

·                £55m for Disabled Facilities Grant in 2018-19, of which the estimate was £0.814m for Manchester.  This was generally a capital grant; and

·                Other national funding was being made available for the following areas:

·                £84m for 5 years on the children’s service programme in 20 areas from 2019/20;

·                £675m Future High Streets Fund in 2019-20 to support local areas to improve access to high streets and town centres; and

·                £10m capacity funding made available to support housing deals with authorities in areas of high housing demand to deliver above their Local Housing Need.

 

Some of the key points that arose from the Committees discussions were:-

 

·                Was there an update on what the proposals were for the pooling of the Council and MHCC budgets as part of the Better Care Fund;

·                It was felt that there needed to be appropriate scrutiny of welfare reforms and Universal Credit and the impact that this were having on the city and the Council; and

·                Reassurance was sought that where there were time limits on the spending of certain funding, such as within Highways, work was being undertaken to ensure that this money was being spent within  ...  view the full minutes text for item 65.

66.

Update on Revenue Financial Strategy and Business Plan Process 2019/20 pdf icon PDF 419 KB

Report of the Chief Executive and City Treasurer

 

This report provides an update on the Council’s financial position and sets out the next steps in the budget process, including scrutiny of the draft Budget proposals and Directorate Business Plan reports by this Committee. 

 

The report also summarises Officer proposals for how the Council could deliver a balanced budget for 2019/20.

Additional documents:

Minutes:

The Committee considered a report of the Chief Executive and City Treasurer which provided an update on the Council’s financial position and set out the next steps in the budget process.  The report summarised Officer proposals for how the Council could deliver a balanced budget for 2019/20.

 

In conjunction to the above, the Committee also received and considered the Corporate Core Business Plan and Strategic Development Business Plan for 2019/20, which set out in broad terms the directorates’ key priorities, key activities and revenue and capital strategy for 2019/20, which was a refresh of the directorates’ Business Plans for 2018/20 in the context of current resources, challenges and opportunities.

 

Taken together, the report and the directorates’ Business Plans illustrated how the directorates would work together and with partners to deliver Our Plan and progress towards the vision set out in the Our Manchester Strategy.

 

Some of the key points that arose from the Committees discussions were:-

 

·                Based on the additional borrowing the Council was intending to take out, what impact was this expected to have on the future capital revenue finance position;

·                Had the confirmation of the New Home Bonus been delayed in light of the delayed announcement of the financial settlement by Government;

·                Clarification was sought as to why the pooled budget for Health and Social Care was to be finalised by MHCC after the Council had set its budget.

 

The City Treasurer advised that the capital financing budget had been set to take account the Council’s likely future borrowing requirements and as such its  position would be remain constant for the next few years.  She also reported that the Funding Strategy had the support of the CCG Governing Body and this now presented a significantly reduced risk to the Council

 

In relation to the Corporate Core Business Plan, some of the key points that arose from the Committees discussions were:-

 

·                How was Directorate intending on influencing outside of the Council the need reduce greenhouse gas emissions, improve air quality and improve public transport and highways making them more sustainable in light of the severe congestion issues within the city centre;

·                Was it felt that it was still possible to reduce demand through reforming services as it didn’t appear to have done so far and when Government were continuing to reduce available resources to all public services;

·                Had there been any benchmarking exercise with similar authorities in relation to the number of ombudsman complaints upheld;

·                Had any impact assessment been undertaken on the Business Rates retention trial monitored to understand its impact on resources;

·                There was a need for the Council to recognise the need to invest in its staff in order to achieve the deliverability of doing more for less;

·                Clarification was sought as to whether the Council had previously decided to reduce the spend associated with the Essential Car User allowance, whether Social Workers had been excluded from this proposal, and if so, how was the savings target of £450,000 be achieved given that Social Workers would  ...  view the full minutes text for item 66.

67.

Setting of the Council Tax base and Business Rates shares for budget setting purposes pdf icon PDF 225 KB

Report of the City Treasurer

 

This report details the method of calculating the City Council's Council Tax base for tax setting purposes and Business Rates income for budget setting purposes for the 2019/20 financial year, together with the timing of related payments and the decision on pool membership.

Additional documents:

Minutes:

The Committee considered a report of the City Treasurer, which advised of the method of calculating the City Council's Council Tax base for tax setting purposes and Business Rates income for budget setting purposes for the 2019/20 financial year, together with the timing of related payments and the decision on pooled membership.

 

Some of the key points that arose from the Committees discussions were:-

 

·                What was being done to lobby government on the exemption of student council tax and the ability to charge HMO Landlord business rates to address the volatility of this area; and

·                As the Council’s retained business rates income was subject to a safety net of 97% of its baseline funding level, did this require the Council to hold a further 3% in contingency reserves.

 

The City Treasurer provided reassurance that the Council did lobby government and when the Council provides its response to the financial settlement, this would feature heavily as well.  She also advised that the Council did not specifically budget for the additional 3% but the Council was prudent in its budgeting and did make allowance for any business rate appeals.

 

Decision

 

The Committee:-

 

(1)          Notes that the City Treasurer, in consultation with the Executive Member for Finance and Human Resources has delegated powers to:-

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

·                calculate the Business Rates income for budget setting purposes in accordance with the Non-Domestic Rating (Rates Retention) Regulations;

·                agree the estimated council tax surplus or deficit for 2018/19;

·                agree the estimated business rates surplus or deficit for 2018/19;

·                determine whether the Council should be part of a business rate pooling arrangements with other local authorities;

·                set the dates of precept payments to the Greater Manchester Combined Authority; and

(2)          Notes that the Chair of the Resources and Governance Scrutiny Committee will be requested to exempt various key decisions from the call in procedures.

 

68.

Proposed changes to the Council Tax charges levied for tax on empty properties pdf icon PDF 188 KB

Report of the City Treasurer

 

This report details proposed changes to the Council Tax charges for empty properties, following the introduction of powers for Councils to charge increased Council Tax Premiums for long term empty (LTE) properties that have been unoccupied and unfurnished for over two years.  The report also contains proposals to remove discounts to Council Tax for unoccupied and unfurnished properties and properties undergoing major works or structural alterations.

Additional documents:

Minutes:

The Committee considered a report of the City Treasurer which set out proposals to charge increased Council Tax Premiums for long term empty (LTE) properties that had been unoccupied and unfurnished for over two years and also to revisit the decisions made in 2012 to give a 100% Council Tax discount for one month if a property is unoccupied and unfurnished and a 50% discount for up to 12 months if a property is undergoing major works or structural alterations, with a view to remove these discounts.

 

The Corporate Revenues Manager and the Director of Customer Services and Transactions referred to the main points and themes within the report, which included:-

 

·                     The financial impact on the amount of Council Tax payable and the New Homes Bonus of the revised long term empty premium;

·                     The financial and non-financial impacts of removing the 100% Council Tax discount that was awarded for up to one month when a property became unoccupied and unfurnished and the 50% discount that was awarded for up to one year when a property is undergoing major repairs or structural alterations;

·                     The Council’s proposals in relation to increasing the amount of Council Tax that was charged for unoccupied and unfurnished properties by charging an additional premium and the proposed changes to its existing policy and remove the Council tax discounts; and

·                     Details of proposed external consultation on the Council’s proposed changes.

.

 

The Committee had been invited to comment on the report prior to its submission to the Executive on 12 December 2018.

 

Some of the key points that arose from the Committees discussions were:-

 

·                     There was support from all of the Committee in relation to the proposals;

·                     The additional income gained from the proposals could be reinvested into the Council's existing discretionary schemes that provide additional financial support to vulnerable residents including the Council’s Welfare Provision scheme and the Discretionary Housing payments scheme;

·                     Would it be possible to gain any more income from the proposals in order to help our poorest residents;

·                     There was a need to positively promote this initiative to Manchester residents; and

·                     Why had the assumption been made that all properties that would be subject to this increase would be in band A Council Tax.

 

The Director of Customer Services and Transactions advised that there were no other discretionary areas that could be used to increase income and it would be unlikely for the Council to gain any more income from the proposals. She acknowledged the need to positively promote the changes following the planned consultation exercise.  She also advised that the assumption had been made that all properties subject to this proposed increase would be in Band A was in order to be conservative in the Council’s estimation of additional income.  Reassurance was given that it would affect a broad mix of properties and agreed to share the data on this with Committee Members

 

Decision

 

The Committee:-

 

(1)        Endorses the recommendations contained within the report that the Executive:-

·                Approve the proposals contained in the  ...  view the full minutes text for item 68.

69.

Process for Updating Capital Strategy (Incorporating P6 Position) pdf icon PDF 348 KB

Report of the Chief Executive and City Treasurer

 

This report provides an update on the 2018/19 capital programme and the process for developing the Capital Strategy for 2019/20 onwards.

 

 

 

 

 

Additional documents:

Minutes:

The Committee considered a report of the Chief Executive and the City Treasurer, which provided an update on the 2018/19 capital programme and the process for developing the Capital Strategy for 2019/20 onwards.

 

Officers referred to the main points and themes within the report, which included:-

 

·                The development of the Capital Strategy to ensure that the Council made capital expenditure and investment decisions in line with Council priorities and properly took account of stewardship, value for money, prudence, risk, sustainability and affordability;

·                The revised approach the Council had taken in relation to the approval process for capital expenditure through the Checkpoint process;

·                The proposed Capital Programme from 2019/20 to 2023/24; and

·                The Council’s capital financing strategy, including detail on restrictions around funds and prudential borrowing.

 

Decision

 

The Committee notes the report

 

 

70.

Update on Capital Projects over £10m pdf icon PDF 355 KB

Report of the City Treasurer

 

This report provides an update on the budgets for the City Council’s major capital projects.

Additional documents:

Minutes:

The Committee considered a report of the City Treasurer, which provided details on the budgets for the Council’s major capital projects.

 

Officers referred to the main points and themes with the report which included:-

 

·                The Council’s capital programme currently totalled £1,475.6m for the period 2018/19 to 2023/24;

·                Large capital projects tended to be complex in nature, and any project which created a long term asset required long term planning, as such projects may need to be agreed before there was cost certainty, and with a degree of risk accepted;

·                If projects required a budget amendment once the project had begun, approval by the Executive or Full Council was required; and

·                Details for each directorate’s major projects (£10m plus), including their original budget compared to their current budget with the rationale for any difference, as well as the current total spend as at the end of September 2018.

 

The Chair informed Members that projects that sat within Highways Maintenance, ICT and HRA Housing programmes were intended to be subject to future reports to this committee.

 

Some of the key points that arose from the Committees discussions were:-

 

·                Was it possible to have an update on the Highways budget spend on footpaths and gully cleansing;

·                How was the Council intending on ensuing it would spend all of the Highways budget for 2019/20 given this years underspend;

·                There was concern that money for the Manchester Football Hubs project which was agreed as part of the 2016/17 budget had not yet been spent and how long was intended to be held for;

·                Why had only £400,000of the £21.3million budget for the Parks Improvement Plan been spent to date;

·                It was suggested that the Committee received a future report on the progress of spend against the Northern Gateway and Eastern Gateway Programmes;

·                Why had the costs of the Civic Quarter Heat Network project almost doubled from £14million to £26million and how confident was the Council that the cost would not increase further given that the project had yet to commence;

·                Clarification was sought as to whether the cost of the redevelopment of St Peter’s Square had overspent form its original budget;

·                Why was the regeneration project at Ben Street underspent;

 

 

The Deputy Chief Executive explained that the funding for the Manchester Football Hubs project had not yet been spent as the Football Association scheme had changed and the Council was currently working with the Association as to how the project could be delivered.  It was explained that if it became clear that the project could not be delivered, the funding would be reviewed to see if there was scope for the project to be delivered using other resources or allocated elsewhere.  In terms of the Parks Improvement Plan, it was reported a new Parks strategy had been agreed earlier in the year which required a feasibility plan to be undertaken to determine how and where best to invest the allocated funding in order to maximise opportunities to secure additional funding.  The Deputy Chief Executive acknowledged  ...  view the full minutes text for item 70.

71.

Overview Report pdf icon PDF 429 KB

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.

Additional documents:

Minutes:

The Committee considered a report of the Governance and Scrutiny Support Unit which contained key decisions within the Committee’s remit and responses to previous recommendations was submitted for comment. Members were also invited to agree the Committee’s future work programme. 

 

Decision

 

The Committee:-

 

(1)       Notes the report;

(2)       Agrees the work programme.

72.

Exclusion of Press and Public

The officers consider that the following item contains exempt information as provided for in the Local Government Access to Information Act and that the public interest in maintaining the exemption outweighs the public interest in disclosing the information. The Committee is recommended to agree the necessary resolutions excluding the public from the meeting during consideration of this item.

Additional documents:

Minutes:

Decision

 

The Committee agrees that the following item contains exempt information as provided for in the Local Government Access to Information Act and that the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

73.

Our Town Hall - Letting of the Management Contract

Report of the City Treasurer

 

This report provides an update on the procurement of a Management Contractor in relation to the refurbishment and partial restoration of the Town Hall and Albert Square under the Our Town Hall (OTH) project.

 

Minutes:

The Committee considered a report of the City Treasurer, which provided an update on the procurement of a Management Contractor for the refurbishment and partial restoration of the Town Hall and Albert Square under the Our Town Hall (OTH) project.

 

The City Treasurer referred to the main points and themes within the report and answered questions from the Committee.

 

Decision

 

The Committee:-

 

(1)       Notes the progress made to date;

(2)       Notes that the City Treasurer will be taking the decision to appoint the preferred contractor as Management Contractor for the Our Town Hall Project;

(3)       Requests that as part of the decision to appoint the preferred contractor, the City Solicitor advises on measures to facilitate site access for the appropriate Trade Union representatives of those working on site  and endeavours to give these a contractual basis as far as is possible within the law, and to liaise with the Chair regarding the proposed wording;

(4)       Agrees that the Ethical Procurement Sub Group look at the National Agreements for the employment, welfare, grading and training of all staff, including apprentices, in the associated construction industries, who are to be employed on the project, with a potential view to requesting Officers ask the preferred contractor to consider adopting these, if they have not already done so;

(5)       Notes the next steps and procurement timetable for the conclusion of the procurement process; and

(6)       Notes the potential implications for cost and programme of delaying the appointment of the Management Contractor.