Report of the Strategic Director (Growth and Development) attached

Following the Spending Review announcements and provisional

local government finance settlement 2022/23 the Council is

forecasting a balanced budget for 2022/23, a gap of £37m in

2023/24 and £58m by 2024/25. This report sets out the high-level

position.

Further to minute (ESC/21/53), the Committee considered a report of the Strategic Director (Growth and Development), which provided a further update on the saving proposals being proposed as part of the 2022/23 budget process.

Key points and themes of the report included:-

·                Following the Spending Review announcements and provisional local government finance settlement 2022/23 the Council was forecasting a balanced budget for 2022/23, a gap of £37m in 2023/24 and £58m by 2024/25;

·                Overall, the settlement announcement was towards the positive end of expectations and it was expected that mitigations in the region of £7.7m, as previously identified, would be sufficient to balance the 2022/23 budget;

·                The budget assumptions that underpinned 2022/23 to 2024/25 included the commitments made as part of the 2021/22 budget process to fund ongoing demand pressures as well as provision to meet other known pressures such as inflation and any pay awards (estimated at 3% from 2022/23);

·                Whilst this contributed to the scale of the budget gap it was important that a realistic budget was set which reflected ongoing cost and demand pressures;

·                The focus would now be on identifying savings and mitigations to keep the Council on a sustainable financial footing; and

·                It was proposed that budget cuts and savings of £60m over three years would be developed for Member consideration which equated to just under 12% of 2022/23 directorate budgets. In addition, £30m of risk-based reserves had been identified as available to manage risk and timing differences;

The Leader advised that whilst there were no major changes to the proposed budget following the report in November, a decade of austerity had resulted in £420 million having been removed from the Council’s budget, resulting in a  15% reduction in spending power compared to a national average of 2.4% and if Manchester had had the national average applied to its budget, it would have a further £85 million in its budget today.

The Strategic Director (Growth and Development) commented that the 2021/22 budget process had included £393k savings in respect of holding/deleting 11 posts in planning and building control.  Whilst the service redesign was expected to be completed in the first quarter of 2022, it would take time to implement the changes and recruit to all the posts.  To allow for service delivery, and succession planning it was necessary to amend the structure and invest in some areas, therefore it was anticipated that ongoing savings of c£150k would be realised from reduced staffing costs across planning and building control. This would require alternative savings of £243k to be identified and delivered in 2022/23.

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

·                There was concern in relation to the ability to effectively ensure the enforcement of illegal planning if it was still proposed to reduce the number of staff within planning and building control;

·                Was it possible to have a breakdown of the proposed savings at a ward or neighbourhood level;

·                What opportunities had been identified from the review of Council assets to help tackle the level of savings needed in future years; and

·                Had there been any work undertaken around the anticipation of additional costs and pressures on the service as the Council emerged from the impact of covid.

The Strategic Director (Growth and Development) commented that the original saving of £393k had been identified through existing vacant posts and through the forthcoming service redesign, additional resource would be added to the service to ensure it operated effectively.  She also advised that due to the nature of the work of the Directorate, it was difficult to break this down to a ward or neighbourhood level as a large part of the Directorate’s budget was made up from staff costs who worked across the city.  It was proposed that a more detailed overview of the work of the team could be provided for Members.

The Executive Member for Housing and Employment acknowledged the need to improve how the work of the Directorate was reported back to ward members on work in their respective wards.

In terms of Asset Management, it was reported that this was something that the Directorate was actively looking at and a Strategic Asset Management Plan would be implemented year which would look to the assets held by the Council across its Development, Operational and Commercial estates to ensure it was maximising the benefits to the city.

The Leader commented that there had been a number areas as part of the wider budget setting process that had been looked at as to how they would likely be impacted as the Council emerged from the impact of covid, such as the discretionary support the Council had been able to give to residents and the support to businesses.  She added that the current competitive environment for government funding was not helpful and was not a long term sustainable approach.

Decisions

The Committee:-

(1)      Note the forecast medium term revenue budget position

(2)      Endorse and recommend that the Executive approve the budget proposals

(3)      Propose that as part of the Committee’s Work Programme setting meeting in May 2022, it receives a report that provides a detailed overview of the Directorate and the teams that sit within it