Agenda and draft minutes

Agenda and draft minutes

Economy Scrutiny Committee - Thursday, 10th November, 2022 2.00 pm

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

Contact: Charlotte Lynch 

Media

Items
No. Item

41.

Minutes pdf icon PDF 103 KB

To approve as a correct record the minutes of the meeting held on Thursday, 13 October 2022.

Minutes:

Decision:

 

That the minutes of the previous meeting, held on Thursday, 13 October 2022, be approved as a correct record.

42.

Economic Strategy Update pdf icon PDF 103 KB

Report of the Strategic Director – Growth and Development.

 

This report provides an update on the development of a new Economic Strategy which sets out how the next phase of Manchester’s growth can ensure that the city’s economy is both high performing and drives a reduction in inequalities.

 

Additional documents:

Minutes:

The Committee considered a report of the Strategic Director of Growth and Development, which provided an update on the development of a new Economic Strategy which sets out how the next phase of Manchester’s growth can ensure that the city’s economy is both high performing and drives a reduction in inequalities.

 

Key points and themes within the report included:

 

·         The vision and key purposes of the Strategy;

·         One option for the structure of the Strategy is to have five themes which sit around the core outcome of ensuring that Manchester’s economy is one of the most high-performing, whilst reducing inequality. The other themes would include:

o   A strategic approach to development and investment

o   Thriving, productive and innovative sectors

o   World class infrastructure, places and talent

o   Zero carbon growth

o   Including more people in economic opportunity

·         Engagement to be undertaken through roundtables and policy panels with leading economists; business engagement through the Business Sounding Board, Our Manchester Business Forum and Anchors Group; and partner engagement through the Our Manchester Forum and other relevant boards;

·         A proposal to approach an external organisation to provide challenge and thinking about the future of economic growth in the city and how this can have the greatest impact on reducing inequality; and

·         The Strategy will be scoped during autumn 2022 and will be formally developed in the first part of 2023 with formal approval in early summer 2023.

 

Key points and queries that arose from the Committee’s discussion included:

 

·         Commending the focus on economic growth;

·         Whether there was an intention to focus on living costs, income and middle-tier jobs;

·         The role of Manchester City Council both in the Greater Manchester region and wider North of England and the benefit of working in partnership to develop the economy;

·         A need for a broader focus around socioeconomic barriers such as unemployment and disability to reduce economic inequality;

·         How the objectives of the Strategy can be married with zero-carbon targets;

·         The importance of considering the types of industries to attract to Manchester;

·         Energy retrofitting, and how this was being undertaken for the Northwards housing stock;

·         If any difficulties had been experienced with retrofitting listed buildings;

·         How the Strategy would address negative externalities and impacts of growth; and

·         What a ‘resilient economy’ looks like.

 

The Strategic Director of Growth and Development emphasised that the Council had a long-term approach to growth and that the Economic Strategy did not signify a fundamental change in the Council’s focus. She highlighted that Manchester’s economy was much stronger than 20 years ago and some of the issues it currently faced were very different, such as unprecedented demand for housing, which needed to be addressed, but the Council would continue to work in partnership with the markets, utilise its assets and take a strategic approach to development and attracting external funding. The Strategy would be owned collectively by stakeholders and developed inclusively to recognise the need for collaboration in addressing a potentially-challenging economic period.

 

The Strategic Director of Growth and Development acknowledged a  ...  view the full minutes text for item 42.

43.

Poverty Strategy Update pdf icon PDF 243 KB

Report of the Director of Inclusive Economy.

 

This report provides an overview of the work undertaken to date to develop a refreshed poverty strategy for the city which for the purpose of this report will be referred to as the ‘Manchester Anti-Poverty Strategy. The report will set out the approach and engagement process for developing the strategy, the evidence base, emerging themes and the suggested priorities and actions that will be included in the final strategy.

 

This report also sets out the relationship between the new strategy fits and existing work on Making Manchester Fairer, developing a more inclusive economy, tackling the Cost-of-Living Crisis and other linked areas of work.

 

Additional documents:

Minutes:

The Committee considered a report of the Director of Inclusive Economy which provided an overview of the work undertaken to date to develop a

refreshed Poverty Strategy, referred to as the Anti-Poverty Strategy in the report, for the city.

 

Key points and themes within the report included:

 

·         Poverty remains a significant and complex problem for Manchester residents, is driven by many external factors and has persisted despite the best local efforts to reduce it.

·         A significant amount of partnership work had been undertaken to deliver the 2017 Family Poverty Strategy over the past five years against a backdrop of health and economic challenges which highlighted and exacerbated poverty in Manchester;

·         The new Anti-Poverty Strategy provided an opportunity to identify the impact of these challenges and extend the Strategy to cover all households with and without children;

·         Conversations with key stakeholders and partners helped to shape the development of the new Strategy as well as understanding the lessons from the Family Poverty Strategy;

·         An Equality Impact Assessment (EIA) was undertaken in June 2022 to identify how poverty impacted on different communities of identity. This indicated that all communities of identity were more likely to live in or experience poverty with the biggest impact felt by disabled residents, people from Black, Asian and Ethnic Minority backgrounds, the over 50’s and people with one or more protected characteristics;

·         The EIA has informed the engagement process of the Strategy, particularly with residents;

·         There were 4 suggested priorities and actions to be included in the final strategy, which were subject to further refinement with our stakeholders as well as formal consultation:

o   Preventing Poverty

o   Mitigating Poverty

o   Pathways Out of Poverty

o   Good Governance and Effective Delivery

·         The Manchester Anti-Poverty Strategy will sit under the Making Manchester Fairer Plan and will support the delivery of these priority actions, along with other key actions identified through the development of the Strategy;

·         A formal online consultation on the draft strategy will be carried out in mid-December, with the final Strategy being taken to Executive in January 2023.

 

The key points and queries that arose from the Committee’s discussion included:

 

·         Welcoming the proposed priorities;

·         How much focus was placed on prevention of poverty and relief that could be provided, given the context of the cost-of-living crisis;

·         How targeted the evidence base was;

·         How the outcomes and delivery of the Strategy would be measured;

·         Commending the pathways out of poverty referenced in the Strategy;

·         How long “breathing space” periods to pause enforcement against residents for non-payment of fines or other charges when they are accessing professional support or help would last;

·         Whether the Council had considered reviewing the use of bailiffs for debt collection;

·         How frequently members will receive progress updates on the work within the Anti-Poverty Strategy;

·         Consultation with ethic minority communities and the voluntary sector;

·         Vagueness within Appendix 1 with regards to gender reassignment and what data the anecdotal evidence referred to in the appendix is based on;

·         The stigma around the term ‘poverty’, and welcoming  ...  view the full minutes text for item 43.

44.

Revenue Budget Update pdf icon PDF 115 KB

Report of the Deputy Chief Executive and City Treasurer.

 

This report sets out the financial challenge facing the Council, the latest forecast position, and the next steps. The Council is forecasting an estimated budget shortfall of £44m in 2023/24, £85m in 2024/25, and £112m by 2025/26. After the use of c£16m smoothing reserves in each of the three years, this gap reduces to £28m in 2023/24, £69m in 2024/25 and £96m by 2025/26.

 

This report sets out the high-level position. Officers have identified potential savings options to reduce the budget gap totalling £42.3m over three years.

 

Even after these proposals there remains a budget gap of £7m to close to get to a balanced budget in 2023/24 and further savings options will be developed between now and January 2023 and be reported back to Scrutiny committees in February. Each scrutiny committee is invited to consider the current proposed changes which are within its remit and to make recommendations to the Executive before it agrees to the final budget proposals in February 2023.

 

Minutes:

In introducing the item, the Chair proposed that item 8 – Growth and Development 2023/24 Budget Proposals – be discussed in conjunction with this item.

 

The Committee considered a report of the Deputy Chief Executive and City Treasurer which outlined the financial challenge facing the Council, the latest forecast position, and the next steps.

 

Key points and themes within the report included:

 

·         The Council is forecasting an estimated budget shortfall of £44 million in 2023/24, £85 million in 2024/25, and £112 million by 2025/26;

·         After the use of circa £16 million smoothing reserves in each of the three years, the estimated budget shortfall reduces to £28 million in 2023/24, £69 million in 2024/25 and £96 million by 2025/26;

·         There remained a budget gap of £7 million to close to get to a balanced budget in 2023/24 despite proposals outlined in the report;

·         The Council’s funding from central government would be confirmed in the Provisional Finance Settlement, which was expected in late December 2022;

·         The indicative medium-term position, planned use of reserves and the level of savings proposals to date;

·         An assumed council tax increase of 1.99% per annum and Adult Social Care precept of 1% per annum;

·         Indicative workforce reduction linked to savings proposals was anticipated to be managed through natural turnover and vacancies;

·         Public consultation on the proposed council tax levels and savings and cuts measures would take place from early November 2022 until January 2023 and a full analysis would be reported to Budget Scrutiny in late February; and

·         The next steps for the budget process.

 

The key points and queries that arose from the Committee’s discussions included:

 

·         Expressing disappointment at the budget cuts imposed by central government;

·         Commending officers for maintaining a strong financial standing for the Council and continuing to support residents; and

·         If and how a reduction of 70 FTE as outlined in the report would impact the workload of teams and services;

 

The Executive Member for Finance and Resources introduced the item by highlighting Manchester City Council as a well-managed and financially-responsible authority and stated that the budget shortfall was the direct result of ideological decisions taken by the government over the previous decade. He explained that the Council’s budget had been unfairly cut by £428 million since 2010/11 and that if Manchester had received the average cuts to funding the city council budget would be £77 million per year better off.

 

Members were informed that the problem was not solely experienced by Labour Councils and a recent survey conducted by Grant Thornton found that 1 in 6 councils would run out of money in 2023/24.

 

The Executive Member for Finance and Resources provided assurances that the loss of 70 FTE would be through natural turnover and there would be no need for voluntary retirement or severance, meaning there would be little impact on the workload of officers and teams. The dedication and commitment of staff to the city enabled the Council to continue providing services for residents.

 

The Directorate Head of Finance highlighted  ...  view the full minutes text for item 44.

45.

Growth and Development 2023/24 Budget Proposals pdf icon PDF 129 KB

Report of the Strategic Director – Growth and Development.

 

The Council is forecasting an estimated budget shortfall of £44m in 2023/24, £85m in 2024/25, and £112m by 2025/26. After the use of c£16m smoothing reserves in each of the three years, this reduces to £28m in 2023/24, £69m in 2024/25 and £96m by 2025/26. Officers have identified potential savings options to reduce the budget gap totalling £42.3m over three years.

 

This report sets out the priorities for the services in the remit of this committee and details the initial revenue budget changes proposed by officers.

 

Even after these proposals there remains a budget gap of £7m to close to get to a balanced budget in 2023/24 and further savings and cuts options will be required to be worked between now and January and be reported back to Scrutiny committees in February. Each scrutiny committee is invited to consider the current proposed changes which are within its remit and to make recommendations to the Executive before it agrees to the final budget proposals in February 2023.

 

Additional documents:

Minutes:

The Committee considered a report of the Strategic Director of Growth and Development which outlined the priorities for the services within the remit of the Economy Scrutiny Committee and highlighted the initial revenue budget changes proposed by officers.

 

Key points and themes within the report included:

 

·         The Growth and Development directorate was made up of City Centre Growth and Infrastructure, Strategic Development, Strategic Housing, Planning, Building Control and Licensing, Investment Estate, Manchester Adult Education Service (MAES), Work and Skills, Digital Strategy and Highways;

·         The Growth and Development directorate has a gross budget of £35.5 million and generates £44.8 million in income;

·         The Highways service has a gross budget of £25.1 million;

·         Proposed savings for these services had been identified and amounted to £3.54 million over three years;

·         Proposed savings and income generation included:

o   Additional income from Manchester Airport Group to the Investment Estate department, although this was dependent on meeting forecasted performance;

o   A saving of £170k once the former Gala Bingo building in Wythenshawe is disposed of and outstanding borrowing is settled;

o   Deletion of a vacant grade 4 post in the Strategic Housing department;

o   Generating increased income through Highways;

o   Deletion of two vacant posts within the Highways service and one Neighbourhood Liaison post;

o   Temporarily reducing gully cleansing for three years;

·         There were no budget growth proposals or emerging pressures within the directorate;

·         An overall reduction of 4 Full Time Employees (FTE) was anticipated as part of the savings proposals but this would be managed through natural turnover and deleting vacancies; and

·         The directorate continued to be affected by Covid-19, particularly in the Investment Estate service, and work was ongoing to assess requests for rent holidays on a case-by-case basis.

 

The key points and queries that arose from the Committee’s discussions included:

 

·         The importance of the Work and Skills service and Manchester Adult Education Services (MAES) and how these were funded;

·         Whether the Strategic Assets Management Plan would be scrutinised by Resources and Governance Scrutiny Committee;

·         Greater Manchester Combined Authority’s (GMCA) budget proposals and how these would affect Manchester City Council;

·         Expressing concern over the proposal to temporarily stop gully cleansing;

·         How temporarily reducing gully cleansing would save money;

·         How the Council would continue to engage with neighbourhoods if it deleted the Neighbourhood Liaison Officer post as proposed;

·         Suggesting that Highways Inspectors be concentrated in areas of regeneration;

·         The impact of deleting the vacant post in the Highways Maintenance Team; and

·         Whether the increased fee income from design and project management work, outlined in Appendix 1, was an external income generator or an internal cost.

 

The Executive Member for Housing and Development explained that the Growth and Development directorate was income-generated through assets, investment estate and new homes which helped to generate net income for the Council to support other services and wider work.

 

The Executive Member for Skills, Employment and Leisure highlighted the interconnectedness of budget cuts and that these would have knock-on impacts on different services and enabling the Council to achieve its  ...  view the full minutes text for item 45.

46.

Overview Report pdf icon PDF 135 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 provided details of key decisions within the Committee’s remit, the work programme, responses to previous decisions and the Economy Dashboard.

 

Decision:

 

That the Committee note the report.