To approve as a correct record the minutes of the meeting held on 18 January 2023 attached.

Decision

The Executive approved as a correct record the minutes of the meeting on 18 January 2023.

Report of the Chief Executive attached

The Executive considered a report of the Chief Executive which provided an update on key areas of progress against the Our Manchester Strategy – Forward to 2025 which reset Manchester’s priorities for the next five years to ensure the Council could still achieve the city’s ambition set out in the Our Manchester Strategy 2016 – 2025.

The Deputy Leader (Statutory) reported that work had commenced to transform three heritage railway arches, situated between HOME arts centre’s building and Whitworth Street West, into a talent development centre for artists of all ages, disciplines and stages in their careers.  The £3.4m Arches project, which would be operated by HOME, would nurture, attract and retain creative talent in Manchester by providing high quality, low cost rehearsal and training space.  The scheme was one of two parts of the Culture In The City project which Manchester City Council secured almost £20m of Government Levelling Up funding for in autumn 2021.  He also reported on Factory International having been hailed by Time Out magazine as one of its ‘23 best things to do in the world in 2023’.  The venue, not yet opened,  was the  only UK entry in the top ten of the magazine’s prestigious list of the best things to see and do this year and one of only two British entries.

The Deputy Leader reported that Sixty organisations across the city were set to be awarded £3.4m in funding through the Council’s Our Manchester grants programme for the Voluntary and Community Sector (OMCVS).  The OMCVS scheme was the Council’s largest grant programme for the voluntary and community sector and helps diverse organisations provide support for residents.  The grants were for multiple financial years in order to help organisations plan and invest with more certainty.  Recipients of the grants provided a wide range of services across the city including supporting residents experiencing poverty, supporting health and wellbeing and supporting communities.

Councillor Leech commented that in relation to the update on HS2, he was concerned with the amended proposals surrounding the vent shaft location in Didsbury West.  He also commented on the potential impact within West Didsbury arising from the diversion of traffic arising from the Manchester to Chorlton Cycleway.

The Leader advised that the Council had petitioned Government on a number of issues within the HS2 proposals and was awaiting Government to formally issue new proposals before it could respond.  Assurance was given that local ward councillors would be consulted before any response was submitted.

The Executive Member for Environment and Transport advised that ward councillors, local residents and business were being regularly briefed on the Manchester to Chorlton Cycleway.  She acknowledged that whilst some decisions may be less favourable than others, the benefits of the new cycleway were far reaching.

Decision

The Executive notes the update.

Report of the Deputy Chief Executive and City Treasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which outlined the projected outturn position for 2022/23, based on expenditure and income activity as at the end of December 2022 and future projections.

The Leader advised that the current budget monitoring forecast was estimating an overspend of £3.5m for 2022/23.   The main drivers of the overspend are the pay award and the reductions in car parking and Christmas markets income and Home to School Transport. Overall, there was an improvement of £4.1m from Period 7, which was the last report to Executive in December 2022.

The position reflected the release of contingencies £0.3m, reduced price inflation requirement of £1.7m and a £0.6m reduction in the budget required for electricity. These amounted to a £2.6m reduction in the corporate overspends.  The Deputy Chief Executive and City Treasurer also commented that there had also been  an increase of £1.5m in Corporate Resources due to the redistribution of the Business Rates levy surplus from Central Government

It was reported that it was positive that the main demand led services within Adults, Children’s and Homelessness were underspending or breakeven, which puts the Council in a better position than many other councils and reflected the investment in prevention strategies over the last few years. 

Any remaining overspend which could not be mitigated in year would require the use of the smoothing reserve or the general fund reserve. The smoothing reserve had been established to assist with timing differences between savings plans being developed and delivered.  It was recognised that any unplanned use in the current year would reduce capacity to support future years savings programme and reduce the Council’s overall resilience.

Full details about of the budget forecasts and variances by Directorate were detailed in the report and budget changes could be summarised as follows:-

·                     Highways - Traffic Signal Optimisation - £0.5m grant awarded for upgrade and maintenance of traffic signals and associated equipment;

·                     Highways - Review of City Centre Controlled Parking Zone and on street tariffs (Parking Reserve) - £50k for the feasibility study estimate of £100k to review the current city centre controlled parking zones and on-street tariffs;

·                     Homelessness – Homelessness Prevention Grant Winter 2022/23 Top-Up. £0.530m to prevent vulnerable households from becoming homeless and manage local homelessness pressures;

·                     Corporate Core – Energy Bill Support Scheme: Alternative Funding Grant.  £2.300m to facilitate the scheme on an agent basis, whereby the Council acts as an intermediary of Government to make grant payments;

·                     Use of reserves over and above that agreed as part of the approved 2022/23 budget - £0.6m to Manchester Aquatics Leisure Centre to offset the income losses from the Leisure provider GLL for 2022/23;

·                     Utilities inflation - £3.246m to cover increased gas prices;

·                     Cost of living payments to internal Foster Carers of £300, expected to cost £150k in total;

·                     Payments to households who missed out on the Universal Credit cost Living autumn payments, estimated at £369k;

·                     £753k released from Contingency; and

·                     Price Inflation requests

The inflationary pressures outlined  ...  view the full minutes text for item 13.

Report of the Deputy Chief Executive and CityTreasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which informed of the progress against the delivery of the 2022/23 capital programme to the end of December 2022, the latest forecast of capital expenditure and the major variances since the Capital Programme Monitoring report submitted in November 2022 and the proposed financing of capital expenditure for 2022/23 and affordability of the Capital Programme.

The Executive Member for Finance and Resources commented that the revised capital budget sat at £575.8m, with a further £472.1m budgeted to be spent across 2023-2025, taking total Council led capital investment in the city to £1,047.9m.

The latest forecasted expenditure for 2022/23 for Manchester City Council was £443.8m compared to the current approved budget of £575.8m. Spend as of 31 December 2022 was £259.4m.  It was reported that the programme was subject to continual review to establish whether the forecast remained achievable.

Whilst the intention was for the Council to progress the programme as stated, some projects and their sources of funding might require re-profiling into future years.

Councillor Leech queried whether the re-profiling of certain aspects of the The Factory would lead to any additional inflationary charges in future years to which the Deputy Chief Executive and City Treasurer clarified that any profiling would not lead to additional costs.

Decision

The Executive note the report.

Report of the Deputy Chief Executive and City Treasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which set out the strategic and financial context which supported the 2023/24 Budget based on the outcome of the Final Local Government Finance Settlement.

The report went on to set out the strategic and statutory context for setting the budget, which included:-

·                     The Our Manchester Strategy;

·                     Progress to date on delivering the Our Manchester Strategy, building on the recent State of the City analysis;

·                     The Corporate Plan;

·                     A summary of the financial position and context;

·                     The required statutory assessment of the robustness of the proposed budget and adequacy of proposed reserves;

·                     Other fiduciary and statutory duties; and

·                     Financial Governance.

The Medium-Term Financial Strategy (MTFS) report to Executive in February 2022 recognised that significant budget cuts would need to be delivered over the Spending Review period to set a balanced budget in future years. When the three-year MTFS was presented in February 2022 the budget gap was forecasted at £37m, in 2023/24, increasing to £58m by 2024/25, reflecting the flat cash funding position set out in the spending review. 

Since then, the national funding outlook for Local Government has become more volatile.  A review of the Council’s budget assumptions was undertaken in August 2022 followed by an emergency financial statement delivered by the new Chancellor, on 17 October 2022, which reversed the majority of the tax changes announced on 23 September 2022.  An updated position was reported to Executive on 16 November 2022, based on the latest Government position and updated for the 2022/23 pay award and increased inflationary pressures which projected a revised forecast gap of £28m in 2023/24 increasing to £69m in 2024/25 and £96m by 2025/26.

Savings options had been developed consisting of £21.1m for 2023/24r increasing to £42.3m by 2025/26, alongside the proposed application of more than £48m of smoothing reserves to support the spending position.  This reduced the forecast gap to £7m in 2023/24, rising to £37m in 2024/25 and £54m by 2025/26.  The financial settlement had provided some additional flexibility and headroom, with savings being reviewed and it was now proposed that savings options of £36.2m are progressed, a reduction of £6.1m overall

Taking into account the above changes to the financial assumptions; the impact of the Autumn Statement and final Finance Settlement; the setting of the Council Tax and Business Rates base and Collection Fund surplus and the changes to savings and investment proposals, the forecast budget position was:-

Report of the Deputy Chief Executive and City Treasurer attached

The report of the Deputy Chief Executive and City Treasurer and City Solicitor explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £10.26m (including Corporate Core savings of £6.024m and Traded Services savings of £4.236m).  The provisional financial settlement announced on 19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures.  This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £7.712 were attributable to the Corporate Core directorate.

The revised core budget saving proposals would be delivered through a combination of:

·                     Transformation delivered through the Future Shape Programme – ensuring that the quality of Council services, resident experiences and outcomes were improved, whilst improving council efficiency and reducing costs resulting in approximately £5m savings over a five year period

·                     Review of workforce structures and capacity alongside taking a realistic view on the ability to fill longstanding vacancies; a review of service areas to identify efficiencies or opportunities for income generation; and delivering a corporate programme of work to ensure the basics were right, sound and competitive procurement, approach to managing inflation, ensuring income budgets were maximised and charges appropriate which would result in a further £3.46m of savings made up of a combination of £170k additional income generation and £3.29m efficiencies

The report also identified that there were growth and investment pressures of £1.777m that needed to be considered as part of the budget setting process:-

There were also some new pressures that had been identified for 2023/24 and beyond which included:-

·                     Information Technology £0.75m - as part of the ICT strategy there had been the roll out of the end user device strategy. In order to provide an ongoing refresh of kit and additional revenue requirements of c£0.75m would be required from 2024/25;

·                     Additional security software - there had been increased requirements in respect of ensuring systems remained secure, and to avoid any security compromises, additional software had been installed in 2022/23 and the  ...  view the full minutes text for item 16.

Report of the Strategic Director for Children’s and Education Services attached

The report of the Strategic Director for Children’s and Education Services explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £11.8m for the Children and Education Services directorate.  The provisional financial settlement announced on19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures. This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £11.725 were attributable to the Children and Education Services directorate.

As a result of the improved financial settlement and alongside observations and challenge from Scrutiny Committee Members, the £75k Youth saving proposal has been removed and inflation assumptions had been reviewed.  In addition, due to increasing Looked After Placement and Permanence placement costs the Managing Demand saving had been delayed and reprofiled.  Furthermore, the School Crossing Patrol savings proposal had also been rephased and whilst it was proposed that savings of £11.725m savings were progressed, the timing of these have been deferred to later years.

The financial settlement had also given some scope for some targeted additional investments focused on preventing and managing future demand to leave the council in a more sustainable position in 2025/26 when the current spending review period ended.

As in previous years the budget options for savings had been informed by the Directorate Budget approach to deliver safe, effective and efficient services, the progress and impact of the services to date.  This approach had contributed to overall looked after children numbers (rates) reducing and remaining relatively stable in Manchester.  Cost reductions have been driven by a reduction in the number of expensive external residential placements.  There had also been a parallel reduction in spend on external foster placements (12% reduction year on year, equating to £2.1m p.a. reduction in spend).

An analysis of the investment in prevention by the Directorate and current placement stability had led to some confidence that placement numbers were not going to increase at the rate assumed in the 2022/23 budget setting process with anticipated savings achieved through fewer and reduced placement costs, totalling £10.615m

Of the savings proposed, £1.110m would focus on charging of existing services to grant, reserves, ceasing activity that it was not achieving planned outcomes or applying different set of budget assumptions.

It was also reported that Looked after Children placements and Home to School Transport demographic demand was determined based on the placement numbers on which the budget was set compared to the current position and potential increase in demand informed by 3% population growth predictions.  Subsequently it was proposed that the Children and Education Services cash limit budget would increase by £2.357m, £2.419m and £2.479m in 2023/24, 2024/25 and 2025/26 respectively as estimated in the 2021/22 budget setting process.

The high and volatile inflationary environment had seen an  ...  view the full minutes text for item 17.

Report of the Director Public Health attached

The report of the Director of Public Health explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £1m attributable to Public Health.  The provisional financial settlement announced on 19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures.  This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £0.73m were attributable to the Public Health budget.

In the context of austerity and the national public health challenges post pandemic, the approach to the development of savings had been extremely difficult. The work had been informed by:

·                     The challenging position across a range of Public Health outcome measures with a worsening of health outcomes in Manchester since the pandemic;

·                     Reducing pressures on the wider health and social care system by ensuring that upstream cost effective prevention programmes were maintained;

·                     The need to protect the Drug and Alcohol service budget linked to new national investment conditions relating to the new national 10-year Drug Strategy, From Harm to Hope; and

·                     The scale of previous Public Health savings programmes.

Proposals had been identified as deliverable without impacting on delivery of public health commissioned services in the city and were summarised as follows:-

As per the Spending Review, it was announced the public health grant would remain the same in real terms which would significantly undermine the ability of local systems to reduce health inequalities without further investment in prevention by the NHS.  However current levels of inflation would significantly erode spending power unless a further increase in grant was confirmed.

If the proposed changes were approved, the three-year budget position would be as follows:-

The savings proposals would have a limited internal workforce impact due to the roles being disestablished being vacant and planned.  This was part of the wider review of roles and responsibilities as resource shifted back to business as usual after the heightened focus on COVID-19 for the last three years.

It was noted that  ...  view the full minutes text for item 18.

Report of the Executive Director of Adult Social Services attached

The report of the Executive Director for Adult Social Services explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £10.025m for the Adult Social Care directorate.  The provisional financial settlement announced on19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures. This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £8.542m were attributable to the Adult Social Care directorate.

In the context of austerity and the national challenges and Adult Social Care (ASC) reform programme underway, the approach to the development of savings built upon the previous work done to date and was cognisant of:-

·                     Better Outcomes Better Lives (BOBL) as the underpinning strategy and the commitments already made to deliver the 2021-24 target, which in itself would be challenging to deliver;

·                     Preventing potential for a negative impact on the wider health and social care system; and

·                     The imperative to maintain the progress against the ASC improvement plan for social work infrastructure and improved practice to support and safeguard our most vulnerable citizens.

The proposals detailed were all considered deliverable but would be challenging to deliver, requiring significant service redesign, reconfiguration and effective change management. The proposals enabled citizen independence and outcomes to be protected or potentially improved but there would need to be an understanding by citizens, families and carers that in some cases care arrangements would have to change and needs may be met in alternative ways.  This was integral if the budget strategy was to be achieved.

The proposed savings programme (£8.542m) was detailed as follows:-

As part of the budget process, it was important that as well as having to find savings to balance the budget, that any service pressures were recognised and where unavoidable were correctly budgeted for, this would allow for the better on-going management of the service and budgets.  These pressures included the standard increases approved annually for demographic pressures and the uplift to care costs driven by the Council’s commitment to pay the Real Living Wage to care staff.

Current pressures reported in 2022/23 which had recurrent budget implications were also included and covered in-house supported accommodation, advocacy costs and deprivation of liberty standards (DOLS) best interest assessments.

In addition, an investment of £1.3m per year 2023-26 would be required to sustain the social work infrastructure and reablement capacity, supporting care models covering Crisis, Discharge to Assess and Manchester Case Management

The Autumn Statement had also included a number of funding announcements of specific importance to social care and further details have been  ...  view the full minutes text for item 19.

Report of the Strategic Director (Neighbourhoods) attached

The report of the Strategic Director (Neighbourhoods) explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £2.191m for the Adult Social Care directorate.  The provisional financial settlement announced on 19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures. This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £0.646m were attributable to the Neighbourhoods directorate.

The Neighbourhood Directorate had a net budget of c£130.3m, with 1,481 budgeted FTE’s.  As part of identifying options the initial priority had been to protect service delivery wherever possible

The following proposed savings had been put forward:-

As part of the budget proposals a further £1m investment into waste and street cleaning was proposed, this would support Basic Services and Street Cleaning and was in addition to the £1m investment into waste and street cleaning put forward as part of the 2022/23 budget

It was also proposed that there would be a further investment of £1.2m to support specific activity in and around the City Centre, District Centres and key arterial routes.

In relation to the annual waste levy costs, these were driven by forecast tonnages of waste to be disposed of and the costs of disposal.  The levy was set by GMCA and based on latest forecasts it is anticipated that this would increase in 2023/24, with the increase to Manchester being £1.024m. Further increases of £1.916m had been assumed split over 2024/25 and 2025/26 and these increases were reflected in the current budget plans for those years.

The budget position also reflected a one-off return of waste reserves from GMCA of £25m, of which Manchester’s share was £4.5m. This has been reflected in the corporate budget to reduce the overall budget gap in 2023/24.

There was no projected workforce impact of activity to deliver the savings.  Effective and robust workforce planning arrangements were in place.

It was note that as development continued across the city this could lead to increased growth pressures for Neighbourhood Services as the number of households grew significantly. These increased demands would include compliance and enforcement, waste collection and disposal and street cleaning.

It was noted that the budget reports had also been considered at a recent meeting of the Communities  ...  view the full minutes text for item 20.

Report of the Deputy Chief Executive and City Treasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which provided an overview of the funding secured and invested to date to enable delivery of Manchester City Council’s Climate Change Action Plan (CCAP) 2020-2025 and set out what has been delivered as a result of the additional revenue funding provided from the Council’s budget for 2022/23 and highlights the priority actions to be delivered between 2023-25.

To date, the Council had made good progress, remained within its carbon budget, and had so far achieved nearly 30% of the target to reduce its CO2 emissions by 50% by 2025. 

To date, the Council has already put in place investment of approximately £227m to deliver the 5-year Climate Change Action Plan along with an additional direct revenue investment of £800k secured as part of the 2022/23 budget setting.  To enable the delivery of the commitments set out in the Council’s CCAP, further revenue and capital investment from multiple funding sources over multiple financial years would be critical and a major challenge

It was recognised that continuing to operate within the remainder of the carbon budget would be challenging and the Council would need to continue to identify and secure investment to deliver on its commitments.  Work proposed in the Council’s Capital Strategy and budget would support some of the ongoing priorities for delivering the CCAP.

The report then outlined the Council’s CCAP priorities for 2023/24 and highlighted where the additional capacity would help to drive these actions forward.

Decision

The Executive note the progress that has been made on delivering the Council’s Climate Change Action Plan during 2022 and endorses the priorities for 2023/24.

Report of the Strategic Director (Neighbourhoods) attached

The report of the Strategic Director (Neighbourhoods) explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m  over the three years to 2025/26 of which there were savings options of £4.646m for the Homelessness directorate.  The provisional financial settlement announced on19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures. This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £4.646m were attributable to the Homelessness directorate.

The Homelessness budget oversaw a gross budget of £71.959m, and a net budget of £28.435mm.  The biggest proportion of the budget was spent on Temporary Accommodation, in particular B&B and Dispersed. The Net Homelessness Budget had increased from £15.1m in 2018/19, an increase of £13.3m per annum to reflect the increase in Temporary Accommodation numbers as well as investment into Prevention.

There were no savings options proposed for Homelessness which would result in a reduction in service.  Over the medium term the savings would be linked to the ambition to reduce numbers in Temporary Accommodation through significant reductions in B&B placements and increased prevention during 2023/26.  However, there were specific demand and inflation pressures facing the Homelessness Budgets. Government refugee and asylum schemes were placing pressure on Manchester temporary accommodation market, driving up cost, resulting in a £4m fee uplift requirement for Homeless Temporary Accommodation and this pressure had been reflected in the Medium Term Financial Plan with £4m of growth proposed for Homelessness in 2023/24.  Resources of up to £1.5m held within the Homelessness reserve would be set aside and would be available for investment in supporting the potential pressures in Homelessness.

The Homelessness Service were working with private sector landlords to try and reduce the number of people who were evicted, with a targeted communications campaign to encourage people to seek advice and support early, prior to eviction.

Of the savings required £3.25m could be achieved over the 3 year period in B&B Accommodation schemes as a result of a combination of reductions made for Transformation and changes in Allocation’s procedure which would reduce the number of families in B&B, as residents were supported to remain in current accommodation.  A further £1.172m of demand reductions would be delivered in Dispersed Accommodation.  This was linked to Transformation and an increase in the number of Dispersed Accommodation properties which were managed by a Registered Provider to reduce the Housing Subsidy loss incurred by the Council in providing this service.  The remaining £224k of proposed savings were linked to an increase in vacancy factor of 2% to 5.5% for Homelessness, this reflected the ongoing difficulties in recruitment and brought the vacancy factor in line with existing and expected levels. It was proposed that this saving would be delivered in 2024/25 as the underspend in mainstream staffing budgets in 2023/24 will  ...  view the full minutes text for item 22.

Report of the Strategic Director (Growth and Development) attached

The report of the Strategic Director (Growth and Development) explained how the budget proposals for the Directorate had been developed.

The 2022/23 budget process saw the Council develop savings and efficiency plans of over £42.3m over the three years to 2025/26 of which there were savings options of £2.398m for the Growth and Development directorate.  The provisional financial settlement announced on19 December 2022 reflected a change in government policy in relation to funding inflation and social care pressures. This had given the opportunity to review the quantum and phasing of savings and it was now proposed that options of £36.2m were progressed, of which £2.169m were attributable to this Directorate.

The Growth and Development Directorate had a gross budget of £36.114m, generates income of £44.886m resulting in a net income budget of £8.772m, and employs 409 FTEs.  In addition, Highways service had a gross budget of £27,959m and a net budget of £20.835m with 243 FTE.

The Directorate received a proportion of annual rental income from Manchester Airport Group.  Based on estimates provided by the Airport, additional income of £1.615m income had been built into the budget over the next three-year period. Achievement of this income was dependent on performance being in line with or better than the forecasts provided.

A review of the funding arrangements for staff had identified opportunities to capitalise staffing costs, the initial proposal was £250k per annum, but following the review of all options this had been reduced by £100k to £150k. This review had taken into consideration the most appropriate source of funding given the activities of staff.

The proposed sale of an asset in Wythenshawe would result in a capital receipt, there was currently a budget of £170k in respect of the internal loan used to fund the acquisition of the building.  Once the site was disposed of the outstanding borrowing would be settled and there will be a saving of £170k per annum.

In respect of Strategic Housing, the deletion of a vacant grade 4 post would result in a £9k saving to the General Fund, with the balance of the saving being reflected in the Housing Revenue Account.

Highway Services initial saving proposals were £354k over three years but following review the total savings proposals had reduced by £129k to a revised total of £225k.  The revised proposals were made up of a combination of increased   income (£160k) and deleting two vacant positions (£60k)

It was also proposed to invest £300k to provide additional resources to enable capacity to support the establishment of a new team within City Centre Growth and Infrastructure, and to provide additional capacity to the Highways Development Specialist team.

It was noted that the budget report had also been considered at a recent meeting of the Economy Scrutiny Committee and the committee had endorsed the proposals in the report (Minute ESC/23/12).

Councillor Leech questioned whether the proposed deletion of a post within Highways Services that would realise £60k savings would make any difference given the increase in  ...  view the full minutes text for item 23.

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

A joint report by the Strategic Director (Growth and Development), the Strategic Director (Neighbourhoods) and the Deputy Chief Executive and City Treasurer presented the proposed budget for the Housing Revenue Account (HRA) for 2023/24 and indicative budgets for 2024/25 and 2025/26.

The report set out the requirements placed on the Council with respect to the HRA budget:-

·                     The Council had to formulate proposals or income and expenditure for the financial year which sought to ensure that the HRA would not show a deficit balance;

·                     To keep a HRA in accordance with proper practice to ensure that the HRA is in balance taking one year with another; and

·                     The HRA must, in general, balance on a year-to-year basis so that the costs of running the Housing Service must be met from HRA income.

The HRA Budget Position for 2022/23, which as of December 2022, was forecasting that net expenditure would be £14.940m higher than income, which would need to be funded by the additional use of reserves to that planned.  In effect the HRA was forecasting an overspend of £1.752m and the main reasons for in year changes were detailed in the report.

Government guidance allowed Local Authorities to increase rents by a maximum of CPI plus 1% for the five-year period 2020/21 to 2024/25. The CPI rate used was based on the September figure in the preceding year, and as at September 2022 CPI was 10.1%.  However, the cost-of-living crisis had resulted in the Government launching a consultation exercise around the level at which the rent cap should be set at in 2023/24.  The Government had since advised that the maximum social rent increase would be capped at 7%, with an exception for properties within PFI contracts, where the standard PFI unitary charges are contractually linked to inflation measures.  Therefore, this report sought approval to increase tenants’ rents for all properties by 7% from April 2023 except PFI properties, where standard increase of CPI +1% (11.1%) was proposed, also in line with Government policy.

Whilst the cap on rents is welcomed from a tenant’s perspective, there was no cap applied in respect of inflationary impacts on expenditure incurred by the HRA and the 7% increase (11.1% for properties managed under PFI contracts) would result in c£2.0m less rental income in 2023/24 and c£78m over the life of the 30-year business plan, which would mean £78m less to invest into the estate over that time.

In light of the current economic climate and the potential impact the proposed rent and heating charge increase may have on the most vulnerable tenants it was proposed that the hardship fund was increased from the initial £200k provided in 2022/23 to £1m in 2023/24. This fund would provide targeted support to those most affected by the cost-of-living crisis.

In light of the current economic climate and the potential impact the proposed 7% rent increase might have on the most vulnerable tenants it was proposed that £200k was earmarked to provide a hardship fund to provide  ...  view the full minutes text for item 24.

Report of the Strategic Director for Children’s and Education Services attached

The Executive considered a report of the Strategic Director for Children’s and Education Services, which provided a summary of the confirmed Dedicated Schools Grant (DSG) allocation from the 2023/24 settlement.

The DSG was a ring-fenced grant of which the majority was used to fund individual schools budgets in maintained schools and academies in the city, early years nursery entitlement and provision for pupils with high needs including those with Education Health & Care Plans (EHCPs) in special schools, special provision and mainstream schools in Manchester and out of city.

The Council receive and managed the DSG within four blocks: schools, central school services, high needs and early years.  A large proportion of it was paid directly to schools and other settings to provide the majority of education services. A proportion of the DSG was provided to the Council to deliver education services.

The 2023/24 DSG notification was received on 16 December 2022 and totalled  £671.364m with and e overall increase in DSG since last year of £37.930.

The Schools Block allocation of £503.271m had been calculated bottom up on the basis as if the national funding formula (NFF) was applied at school level.  On average the DfE has increased the formula determined by pupil level data by 3.5%.

The Central School Services Block (CSSB) allocation was £3.753m and supported the Council’s role in education.

The Higher Needs Block (HNB) allocation was £122.847m and provided increased funding for children and young people with special educational needs and disability from early years to age 25 years. The DfE had allocated an additional £0.97bn to the HNB nationally.  Manchester’s additional HNB grant was £8.306m, an increase of 7.25% compared to 2022/23, and was £1m higher than previously expected.

The Early Years funding was £41.494m and this was provisional figure which reflected the 2023/24 early years national funding formula (EYNFF) rates for all councils published in December 2022.  This funding would be finalised at a later date. 

In addition, Manchester had been allocated £22.250m from the Government’s £2bn additional schools funding, on-top of the 2023/24 DSG. This additional funding would provide support for schools (reception to year 11) for pay and inflation increases. The funding did not include any allocation for early years or post-16.  For 2023/24 this would be in the form of a separate grant, the DfE intended to incorporate this funding into core budget allocations for 2024/25, so for schools 5 to 16 years, this would mean the funding being rolled into the schools national funding formula (NFF) from 2024/25.

It was noted that the report had also been considered at a recent meeting of the Children and Young People’s Scrutiny Committee and the committee had endorsed the proposals in the report (Minute CYPSC/23/11).

Decision

The Executive approves the proposed Schools Budget including specifically the following:-

·                     All Manchester primary and secondary schools should receive a per pupil increase between 0.5% minimum and up to 3.2% on pupil-led funding.

·                     Manchester does not intend to propose a 0.5% transfer from the school block to  ...  view the full minutes text for item 25.

Report of the Deputy Chief Executive and City Treasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which presented the capital budget proposals before their submission to the Council.

The Capital Strategy had been developed to ensure that the Council could take capital expenditure and investment decisions in line with Council priorities and properly take account of stewardship, value for money, prudence, risk, sustainability and affordability.

The capital programme 2023/24 to 2025/26 comprised the continuation of the existing programme. For continuing schemes, the position was based on that set out in the report on Capital Programme Monitoring 2022/23, also being considered at this meeting (Minute Exe/23/14 above).

Details on the projects within the programme were set out in the report and the full list of the proposed projects was appended to the report.

If agreed, then the proposals contained in the report would create a capital programme of £443.8m in 2022/23, £426.8m in 2023/24, £199.7m in 2024/25 and £34.1m in 2025/26, summarised as follows:-

 The proposed funding for the programme across the forecast period was as follows:-

The proposed capital programme described within the report was affordable within the existing revenue budget based on the estimated capital financing costs associated with delivering the programme.

There were risks associated with the delivery of the capital strategy, specifically regarding delays to the programme or treasury management risks.  Measures were in place to mitigate these risks through both the Strategic Capital Board and the treasury management strategy. Reports would be provided throughout the year to Council, Executive and other relevant committees providing updates on the progress of the capital programme and the risks associated with its delivery and funding.

Decisions

The Executive:-

(1)          Approve and recommend the report to Council, including the projects for Council approval in section 6, and note that the overall budget figures may change subject to decisions made on other agenda items.

(2)          Note the capital strategy.

(3)          Note that the profile of spend  ...  view the full minutes text for item 26.

Report of the Deputy Chief Executive and City Treasurer attached

The Executive considered a report of the Deputy Chief Executive and City Treasurer, which set out the proposed Treasury Management Strategy Statement and Borrowing Limits for 2023/24 and Prudential Indicators for 2023/24 to 2025/26.

The Treasury Management Strategy Statement set out the risk framework under which the Council’s treasury management function would operate by detailing the investment and debt instruments to be used during the year the Strategy detailed the risk appetite of the Authority and how those risks would be managed.

The suggested strategy for 2023/24 was based upon the treasury officers’ views on interest rates, supplemented with the forecasts provided by the Council’s treasury advisor, Link Asset Services. The strategy covered:-

·                     Prudential and Treasury Indicators for 2023/24 to 2025/26;

·                     Impact of 2012 HRA reform;

·                     Current Portfolio Position;

·                     Prospects for Interest Rates;

·                     Borrowing Requirement;

·                     Borrowing Strategy; and

·                     Annual Investment Strategy.

The Executive noted the proposed Annual Investment and Borrowing Strategies set out in the report and agreed to commend them to the Council.

Decisions

The Executive:-

(1)       Recommends the report to Council.

(2)       Delegates authority to the Deputy Chief Executive and City Treasurer, in consultation with the Executive Member for Finance and Human Resources, to approve changes to the borrowing figures as a result of changes to the Council’s Capital or Revenue budget and submit these changes to Council.

Report of the Strategic Director (Growth and Development) attached

The Executive considered a report of the Strategic Director (Growth and Development), which sought approval of the final draft Manchester Active Travel Strategy and Investment Plan (MATSIP).

The Executive Member for Environment and Transport advised that the draft MATSIP set the case for investing in active travel measures, primarily in the form of highways schemes but also supporting infrastructure, and how the Council would go about delivering these interventions.  .

Active travel schemes were primarily funded externally through competitive bidding processes to Department for Transport, via Transport for Greater Manchester and it was a key aim of the Strategy to support the production of bids and business cases to secure this funding, and to propose a framework which set out which areas of the city should be prioritised in order to achieve the Council’s wider policy objectives.

The draft MATSIP also set out the significant benefits to active travel investment across a range of policy areas including public health, clean air and zero carbon.  It set out the overall target to make walking the natural choice for short journeys and to double cycling’s mode share by 2028 and the four objectives which underpinned this overall target:-

·                improving access to the city centre, district centres, parks and other key destinations;

·                enabling safe access to schools and colleges;

·                improving citywide health and wellbeing

·                reflecting the diversity of Manchester and addressing transport inequalities

It was noted that the support and promotion of active travel along with aligned investment in other infrastructure would help reduce transport-related carbon emissions by increasing the overall share of public transport, cycling and walking trips and reducing short journeys by car.

Decisions

The Executive

(1)       Approve and endorse the Manchester Active Travel Strategy and Investment Plan.

(2)       Delegate responsibility to the Strategic Director (Growth and Development), in consultation with the Executive Member for Environment to make any minor amendments to the final Strategy resulting from feedback during the approvals process, prior to its publication. 

Report of the Chief Executive and Place Based Lead attached

The Executive considered a report of the Chief Executive, which set out the intention to establish Manchester Partnership Board as the locality board for Manchester as a further step towards health and care integration.

The Integrated Care Board (ICB) for Greater Manchester (NHS GM) was established with effect from 1 July 2022 replacing ten CCGs in Greater Manchester.  The existing Section 75 partnership agreement between the Council and the CCG was transferred to NHS GM on that date.   Manchester now intended to establish Manchester Partnership Board (MPB) as the locality board for Greater Manchester, bringing together responsibility for the pooled budget with the exercise of NHS GM functions delegated to place level.

The MPB would operate as a ‘hybrid’ committee and it remit would be:-

·                To  be a committee of the ICB at place level, which was able to exercise delegated functions of the ICB other than those functions which related to the Better Care Fund (BCF) Section 75 agreement.;

·                To be responsible for the BCF Section.75 pooled budget which the MHCC Board was previously responsible for; and

·                To be a consultative forum that brought the leaders in health and care together to take strategic decisions at one time and in in one place.

It was reported that Health and Wellbeing Boards would continue to play a key role within integrated care systems.  Decisions taken by MPB would be reported to the Health and Wellbeing Board in Manchester.  MPB’s decisions would be informed by the Joint Strategic Needs Assessment and Health and Care Strategy that were produced by the Health and Wellbeing Board. 

Decisions

The Executive:-

(1)       Note and agree the process for establishing Manchester Partnership Board as the locality board for Manchester.

(2)       Note that the locality board will operate as a hybrid committee arrangement and accordingly:

(3)       Support the decision of NHS GM to delegate functions at place level to Manchester Partnership Board;

(4)       Agree that Manchester Partnership Board acts as a s.75 committee that has responsibility for the Better Care Fund pooled budget; and

(5)       Agree that Manchester Partnership Board operates as a consultative forum that consists of health and care leaders at place level.

Report of the Strategic Director (Growth and Development) attached

The Executive considered a report of the Strategic Director (Growth and Development), which sought approval to dispose of the above property, to Mosscare St Vincent (herein MSV), on a long leasehold basis to facilitate the delivery of an affordable tenure residential development targeted towards the over-55s.

The Executive Member for Housing and Development explained that the redevelopment of Chorlton Baths would comprise a new residential scheme of 50 apartments (with additional flexible ground floor space for wider community uses).  The tenure will be split, with 40 units available for affordable rent, seven units available for shared ownership and three units let to the City Council’s Adult Social Care team for use as Neighbourhood Apartments.  The proposed scheme would be the first new affordable homes delivered in Chorlton since April 2015.

The scheme would be built to HAPPI design principles and would be low carbon and sustainable.

It was expected that by targeting over 55s, the scheme would free up family housing in South Manchester by encouraging residents out of under occupied homes in Whalley Range, Chorlton and Chorlton Park.

The proposed lease was for a term of 999 years at a premium which was less than the best consideration that could reasonably be obtained on the basis of an unrestricted disposal that would not reflect the high standard of development or level of affordable tenures.

Decisions

The Executive:-

(1)      Approve the basis of the land transaction at less than best consideration in accordance with the commercial terms set out in the associated Part B report.

(2)      Delegate authority to the Strategic Director (Growth and Development) to complete the finalisation of terms of the transaction as set out in this report.

(3)      Delegate authority to the City Solicitor to enter into and complete all documents and agreements necessary to give effect to the recommendations.

The officers consider that the following item or items 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 Executive is recommended to agree the necessary resolutions excluding the public from the meeting during consideration of these items. At the time this agenda is published no representations have been made that this Executive part of the meeting should be open to the public

Decision

The Executive agrees to exclude the public during consideration of the following item which involved consideration of exempt information relating to the financial or business affairs of particular persons and public interest in maintaining the exemption outweighs the public interest in disclosing the information.

Report of the Strategic Director (Growth and Development) attached

The Executive considered a report of the Strategic Director (Growth and Development) which set out the financial implications of the proposal to dispose of Chorlton Leisure Centre, to Mosscare St Vincent (MSV), on a long leasehold basis to facilitate the delivery of an affordable tenure residential development targeted towards the over-55s.

Decisions

The Executive:-

(1)      Approve the basis of the land transaction as set out in Section 2 of the report at less than best consideration

(2)      Authorise the Strategic Director (Growth and Development) to finalise the detailed terms of the transaction as set out in principle in this report.

(3)      Authorise the City Solicitor to enter into and complete all documents and agreements necessary to give effect to the recommendations.