Agenda and minutes

Agenda and minutes

Resources and Governance Scrutiny Committee - Thursday, 16th January, 2025 10.00 am

Venue: Council Antechamber, Level 2, Town Hall Extension. View directions

Contact: Charlotte Lynch  Email: charlotte.lynch@manchester.gov.uk

Media

Items
No. Item

1.

Minutes pdf icon PDF 120 KB

To approve as a correct record the minutes of the meeting held on 5 December 2024.

Minutes:

Decision: That the minutes of the meeting held on 5 December 2024 be approved as a correct record.

2.

Revenue Budget update and Provisional Local Government Finance Settlement 2025/26 pdf icon PDF 142 KB

Report of the City Treasurer.

 

This report updates on the revenue budget position and outlines the main announcements from the provisional local government finance settlement 2025/26, which was published 18 December 2024. This report also updates on the grant notifications and the implications for the Council’s position. 

Minutes:

The committee considered a report of the City Treasurer which provided an update on the revenue budget position and outlines the main announcements from the provisional local government finance settlement 2025/26, which was published 18 December 2024.

 

Key points and themes within the report included:

 

  • Subject to the outcome of the budget consultation, it was expected that the proposed savings of £18.232m, alongside the provisional settlement announcements, would be sufficient to allow a balanced budget to be set for 2025/26;
  • Forecast pressures and changes to the 2025/26 budget position;
  • A comprehensive spending review would take place in Spring 2025 which would set the funding envelope for local government for the following two years to the end of 2027/28;
  • Grant notifications and the implications of these on the Council’s position;
  • Longer-term funding reform;
  • The outcome of the provisional settlement will be considered in light of the consultation results and final options brought forward for decision in February to enable the setting of a balanced budget for 2025/26, and updated forecasts for 2026/27 and 2027/28; and
  • Next steps in the budget-setting process.

 

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

 

  • If Manchester was involved in the review of local government funding distribution formulas to reflect the needs of the authority and residents;
  • How confident officers and the Executive Member were that investment in prevention and demand management would help to prevent increased overspend in adults’ and children’s social care;
  • Why £20m had been forecasted each year up to 2028 to address the 2024/25 position as shown in table 1;
  • Recognising discrepancies at table 3;
  • Requesting clarity to the high-level potential change to budget gap and savings options identified in table 4; and
  • The budget allocated for business rates reset, and whether there was any flexibility to this.

 

The Executive Member for Finance and Resources introduced the report and stated that fourteen years of the previous government administration had resulted in a broken finance system, from which Manchester had been disproportionately affected, and that the new Labour government recognised the importance of local government and was resetting this relationship. He stated that the provisional local government finance settlement 2025/26 was the best settlement since 2009 and would provide relief for in-year pressures and allow transformative work going forward. He acknowledged that, despite the positive settlement, eighteen councils across the country were seeking financial support from the government to balance their budgets which he stated gave a picture of the scale of the challenges facing local government. He highlighted the current government’s commitment to fairer funding based on deprivation, need and a low council tax base and stated that Manchester’s spending power had increased by 9.2% as a result of the settlement, compared to a national average of 6%. He noted continued pressures in demand-led services such as social care and homelessness and that the Council was continuing to progress savings options of £18m, which would be achieved through income generation and efficiencies. He informed the committee that  ...  view the full minutes text for item 2.

3.

Sales, Fees and Charges - Budget 2025/26 pdf icon PDF 170 KB

Report of the Deputy Chief Executive and the City Treasurer.

 

This report updates the committee on the current work being undertaken to review all sales fees and charges as part of the 2025/26 budget process to ensure that charges are correct, that the costs of providing the services are being recovered and identify opportunities for increasing existing budgets in order to support the overall Council 2025/26 budget.

Additional documents:

Minutes:

The committee considered a report of the Deputy Chief Executive and the City Treasurer which provided an update on the current work being undertaken to review all sales fees and charges as part of the 2025/26 budget process to ensure that charges were correct, that the costs of providing the services were recovered and to identify opportunities for increasing existing budgets in order to support the overall Council 2025/26 budget.

 

Key points and themes within the report included:

 

  • The options developed outlined over £4.772m of proposed additional income budgets which would help to balance the Council’s budget and minimise the impact of budget cuts on residents;
  • A breakdown of sales, fees and charges across the Corporate Core, Neighbourhoods and Growth and Development directorates;
  • The review process and proposed price increases;
  • Charges with a direct impact on residents were proposed to be restricted to a maximum increase of 5%;
  • Considerations given to the current economic and inflationary environment and the impact on residents and service user; and
  • Future opportunities and risk.

 

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

 

  • The appropriateness of using ‘overachievement’ to describe increased income from bereavement services;
  • The impact of proposed increases to allotment fees, particularly following flooding earlier in the year;
  • Suggesting that the committee scrutinise invest-to-save options and income generation and governance of the enforcement service;
  • Proposals to increase income in libraries and how this might disproportionately impact low-income service users;
  • Requesting further detail on the savings for Corporate and Events;
  • How advertising types would be expanded and how this might impact the look and aesthetic of public spaces;
  • How increased parking charges would be applied and the impact of this on city centre businesses; and
  • How public feedback would be incorporated into fees and changes and if further reviews would be undertaken.

 

The Directorate Head of Finance introduced the report and explained that the overall budget in 2024/25 for sales, fees and charges amounted to £132m and a shortfall was forecasted for this financial year. He explained that it was proposed to increase the income budget by £4.7m through increased costs and recovery and assumptions in areas beyond the Council’s control, such as government-imposed fees, and that this would support the wider Council budget. He stated that work was ongoing to finalise some of the proposed increases and final proposals would be submitted for consideration in February.

 

In response to queries regarding the proposed increase to allotment fees, the Directorate Head of Finance explained that there had not been an increase to these fees for a number of years and that a benchmarking exercise would be undertaken against the fees charged by other local authorities. It was also stated that the service would look into mitigations for those with allotments affected by flooding in early January. The Executive Member for Finance and Resources explained that these proposals were developed before the flooding and that the Council recognised the need for a sensitive approach to communicating any increase in  ...  view the full minutes text for item 3.

4.

Imposition of a 100% Council Tax premium on empty, furnished properties pdf icon PDF 97 KB

Report of the Head of Corporate Revenues.

 

This report confirms the Executive’s decision on 17 January 2024, introduced on 1 April 2024, to increase the Council Tax on empty properties with the aim of increasing the supply of residential properties and maximise occupation in Manchester. The report also reviews exemptions to a blanket imposition introduced by the government on 1 November 2024.

Minutes:

The committee considered a report of the Head of Corporate Revenues which confirmed a decision made by the Executive on 17 January 2024, introduced on 1 April 2024, to increase the council tax on empty properties with the aim of increasing the supply of residential properties and maximising occupation in Manchester. The report also reviewed exemptions to a blanket imposition introduced by the government on 1 November 2024.

 

Key points and themes within the report included:

 

  • From 1 April 2024, empty, unfurnished properties paid the 100% long term empty premium after one year instead of two years;
  • From 1 April 2025, in line with legislation, empty, furnished properties would pay up to a 100% premium from the date that they became empty;
  • Adopting these powers would generate additional council tax revenue of up to £3.7m, of which Manchester would retain £3.1m;
  • A 12-month exemption to this applied to dwellings that were actively marketed for sale or let and empty dwellings that required or were undergoing major repairs or structural alterations;
  • Behavioural change and liability amendments; and
  • Impact on residents.

 

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

 

  • How the Council would know if a property was being actively marketed for sale or rent and how it would try to prevent phantom tenancies;
  • How the Council had projected the additional council tax revenue as a result of adopting the policy;
  • What the impact would be on Houses in Multiple Occupation (HMOs);
  • When the committee could assess the impact of the policy;
  • Recognising that probate could be a long process, and querying what flexibility the Council offered with regard to council tax payments on properties under probate;
  • What levers the Council had to bring empty homes back into use where probate was granted to somebody living abroad;
  • What flexibility the Council offered with regards to empty properties that were difficult to sell due to cladding issues;
  • Recognising that success of the policies would be demonstrated through a decrease in the number of empty properties in the city;
  • How many properties were currently empty in Manchester; and
  • How council tax would be collected where a property was empty due to the resident being in prison.

 

The Head of Corporate Revenues informed the committee that a 100% council tax premium for properties that were empty and unfurnished for more than one year had been applied from 1 April 2024 and that, from 1 April 2025, a 100% council tax premium on empty and furnished properties would be applied from the day they become empty. He explained that the rationale behind these policies was to increase housing supply in the city. The committee was also advised of government-assigned exemptions to these premiums, including properties actively for sale or rent.

 

In response to members’ queries, the Head of Corporate Revenues explained that evidence of property viewings and communication with estate agents would be required to qualify for an exemption to the 100% premium where a property was marketed for sale  ...  view the full minutes text for item 4.

5.

Overview Report pdf icon PDF 132 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.

Minutes:

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 any items for information previously requested by the Committee.

 

The Chair clarified that the meeting on 26 February 2025 would commence at 4:30pm.

 

In response to a member’s query, the Governance and Scrutiny Team Leader recognised that some entries listed on the Register of Key Decision dated back to 2023 and explained that this was regularly reviewed to ensure accuracy and to monitor decisions yet to be taken. She also advised that decisions must be published on the Register for a minimum of 28 days and that the due dates attached to individual decisions constituted the earliest that decision could be taken.

 

Decision:

 

That the report be noted.