Agenda item

Agenda item

Budget 2025/26

Minutes:

The Committee considered the report of the City Treasurer that provided a high-level overview of the latest budget position for the Council in respect of its 2025/26 budget.

 

The Executive Member for Finance and Resources referred to the points and themes in the report which included:

 

·       Noting that the Council was forecasting an estimated budget shortfall of £101m in 2025/26, £126m in 2026/27, and £164m by 2027/28;

·       Mitigations approved in previous budget rounds included approved savings of £32m, the use of c£18m smoothing reserves in each of the three years, and a Council Tax increase of 4.99% (c£11m) a year. After these mitigations the gap reduced to £29m in 2025/26, £41m in 2026/27 and £77m by 2027/28;

·       Noting that councils faced a funding gap of £6.2 billion over the next two years, and this needed to be considered in the context of an estimated £24.5 billion in cuts and efficiencies in service spending that councils had made since 2010/11;

·       Noting that over the same period the Council had delivered over £440m of savings;

·       The 2023/24 outturn position reported to Executive 5 June 2024, reported an overspend of £5.3m. The second monitoring report of 2024/25 was considered by Executive on 13 November, reporting a forecast overspend of £20m. The ongoing implications of this overspend must be considered as part of the budget setting process;

·       Consideration of the Government’s Autumn Statement, noting that a key headline for Local Government was that Core Spending Power would increase by 3.2% in real terms in 2025/26;

·       Noting that Ministers had indicated additional funding would be targeted through a deprivation-based approach; and

·       A summary of the budget position, noting that the final budget position for 2025/26 would be confirmed at February 2025 Executive. This would be after the Finance Settlement was received and key decisions confirming the Council Tax and Business Rates tax base to be used to determine the collection fund position had been made in January.

 

The Committee also considered the report of the Strategic Director (Children and Education Services) which provided officer-developed options to contribute to the balancing of the overall Council budget. Final options would be proposed following the announcement of the provisional Local Government Finance Settlement, expected prior to Christmas. The Committee was invited to consider the current proposed changes which were within its remit and to make recommendations to the Executive. The Committee would have the opportunity to review proposals in the context of the financial settlement again in February and make final recommendations for the Executive to consider on 19th February 2025 when the final budget decisions would be made.

 

Key points and themes in the report included:

 

  • Service overview and priorities;
  • Service budget and proposed changes;
  • Commissioning and procurement priorities;
  • Workforce implications; and
  • Equality and anti-poverty impact.

 

Some of the key points and themes that arose from the Committee’s discussions were:

 

  • How the additional funding announced by the Government would be used;
  • The impact of the new route plan software for Home-School Transport;
  • The impact of early intervention and prevention initiatives in reducing demand;
  • Thanking officers for their work;
  • To welcome the actions outlined at 3.4 in the report, in particular in relation to fostering and the development of the new Greater Manchester shared children’s residential care service, Project Skyline, noting the importance of being innovative;
  • Sharing best practice with and supporting other local authorities;
  • The use of interim and agency staff; and
  • The Social Work apprenticeship scheme.

 

The Executive Member for Finance and Resources reported that the announcements from the new Government were very welcome but there was still a lot of uncertainty, with neither the provisional Local Government settlement nor the formula for distribution of funds across local authority areas yet confirmed.  He advised that every year the overspend was being covered from the General Reserve Fund but that this Fund needed to be replenished from the 2025/26 budget.  He reported that, while this year was a one-year settlement from the Government, in future years, local authorities would receive multi-year settlements and this certainty would help the Council to plan early help work and to reduce demand.  He highlighted that a lot of the proposals put forward related to income generation, efficiency savings and transformational work rather than cuts to services.

 

The Director of Education reported that the new planning software for Home-School Transport had already had a positive impact, with £1.1 million in savings from its first use.  She advised that there had been a reduction in single occupancy vehicles and that it did result in some children’s journeys being longer but that the transition to the new routes had been smooth and complaints about the service were rare now.  In response to a question from the Chair, she advised that some elements of Home-School Transport were in-house, in particular the policy, the eligibility assessment, the management and the passenger assistants; however, she advised that the vehicles and drivers were commissioned, that there were no plans to bring these in-house and she did not believe that this element could be delivered more efficiently in-house.

 

The Acting Deputy Director of Children’s Services outlined how the early intervention approach was preventing families from requiring Child in Need statutory services, while highlighting that in recent years families had been presenting with greater complexities.  She advised that Key Performance Indicators (KPIs) demonstrated that the long-term investment into Early Help had impacted positively on demand and referrals into statutory services and the numbers of Looked After Children.  She informed Members about the support offered to foster carers, including the Mockingbird programme, which provided peer-to-peer support and tailored training and which was currently being expanded.  She outlined the Trailblazer Projects that Manchester was involved in, advising that these presented opportunities to share best practice and advised that the Council also shared best practice through a range of other means, including the Early Help Community of Practice, Core Cities and the Local Government Association.  

 

The Acting Strategic Director (Children and Education Services) reported that 86% of children with a Child In Need (CIN) plan who received Early Help did not then require another CIN plan over the following year.  He also reported that the number of Looked After Children proportionate to the population was lower than in 2010, if Unaccompanied Asylum Seeking Children were excluded from the figures, and that Social Workers average caseloads had significantly reduced.  He informed Members that the cost-of-living crisis had resulted in more families requiring support from Early Help, in particular short-term help in relation to financial issues and housing.  He reported that in 2020, 13% of staff were agency workers but that this had now reduced to 8% and that staff turnover had also reduced significantly.  In response to questions from the Chair, he provided further information on Project Skyline, a major capital investment, led by the Greater Manchester Combined Authority (GMCA), to create a new Greater Manchester shared children’s residential care service, which would sit alongside the Council’s own sufficiency projects.  In response to a question from the Chair about including the voice of young people, he confirmed that young people had been engaged with in relation to this project and he offered to provide further information after the meeting.  He reported that the numbers on the Social Work apprenticeship in Children’s Services had been doubled from 6 to 12 and that this was a rolling programme.  He advised that the Council would continue to invest in this programme and he was optimistic about Government support for extending this.  The Acting Deputy Director of Children’s Services provided information on a separate programme that the Council had been participating in for several years for people with degrees to move into Social Work via an intensive two-year programme.  She reported that the Council had previously run a Step Up to Social Work scheme for existing Council staff.

 

The Assistant Finance Director (Children, Education and Schools) advised that spending on residential placements was £60 million in 2010/11 and this had remained the same up to 2022/23, which was a significant achievement, considering inflation over this period; however, she advised that costs had since increased due to significant increases in the cost of external placements.

 

The Executive Member for Early Years, Children and Young People informed Members about the journey that Children’s Services had been on since 2014, when it had been judged as inadequate by Ofsted.  She reported that she would share a letter from Bridget Phillipson, the Secretary of State for Education, outlining the new Government’s approach to children’s social care, “Keeping Children Safe, Helping Families Thrive”, advising that this included a cap on charges for external placements.  She encouraged the Committee to undertake more visits to frontline social work teams across the city. 

 

Decision

 

To note the reports and the proposed budget changes relevant to the remit of this Committee.

Supporting documents: