Manchester City Council has launched a public consultation on £41.5m of savings options published today, Monday 25 November 2024.
Residents of the council area are being asked for their views on the potential measures, identified by officers, which would be introduced over the next three years (2025/26 to 2027/28 inclusive) to address the Council’s challenging financial position.
They have been produced as part of the process to set the budget for 2025/26, as well as planning ahead for future years. Councillors will decide which options to proceed with in the new year once the Council has received its funding settlement from Government and its exact financial position for next year is known.
The consultation, which also asks residents about Council Tax levels and their priorities for the city, can be found here
The predicted position
After 14 years of austerity, unfair cuts and increased costs the Council still faces a big budget gap between how much it predicts it will need to spend on services next year and how much funding it will have available.
If the Council had not had to make the savings it has since 2010, and had been funded for the pressures it has faced, the city would have £443 million a year more to spend on essential services. Even if Manchester had received only the same level of funding cuts as the average English council it would be £75 million a year better off.
Measures in the new Government’s recent Autumn Statement may have improved the Council’s position for 2025/26 somewhat – and they offer grounds for future optimism – but we won’t know our exact funding until the end of the year.
While austerity is over, we are still dealing with the problems it created so we still need to make significant savings.
Despite our best efforts to transform adult and children’s care services, improving early help and prevention of issues to manage demand, in line with other places across the country we are still seeing a steep increase in the cost to us of care services. This means we are facing an in-year overspend for 2024/25– currently projected at around £20m - which will need to be addressed. While this can be plugged using our reserves, those reserves will then need to be replenished which will have a knock-on impact on the 2025/26 budget.
As things stand, the projected budget shortfall for 2025/26 is £29m, increasing to £77m by 2027/28 unless the gap can be closed through savings or further funding.
Careful planning over many years, and tight cost controls, mean the Council remains confident it will be able to put forward a balanced budget for 2025/26 which protects frontline services which people rely on - from social care to libraries, leisure centres and parks -while continuing to deliver on key priorities such as tackling poverty, supporting residents through the cost-of-living crisis and building affordable homes.
Savings options
But it will only be possible with extensive savings on top of those previously agreed and the prudent use of reserves.
Of the £41.5m of savings options identified, the large majority – more than £33m - are through increased income generation (£20.3m) or efficiencies (£13.1m) – with only £2.3m of the options relating to service reductions. The remaining £5.8m of options relate to transformation where savings will be generated through win-win service changes which promise to reduce the cost of services while improving the outcomes for service users.
Examples of the different types of saving options
Examples of income generation include:
Potential changes to how the Council charges for care to support people to stay in their homes so that those with the most assets pay the full cost of their Council care. Historically Manchester’s policy has been more generous than other local authorities. This does NOT apply to charges for permanent or temporary care home places. Together with an expected increase in demand and uplifts in care costs this would raise an estimated £7.5m over three years.
Reviewing parking charges to align with those in privately-owned car parks with an estimated £1.5m income uplift in 2025/26
Re-tendering the contract for Council-owned digital advertising screens, generating a predicted £1.35m over three years (£650,000 in 2025/26)
An increase in the Fixed Penalty Notice fine for littering from £150 to £180 resulting in an estimated £75,000 extra income in 2025/26
Examples of efficiency savings include:
Removing vacant posts which have not been filled for more than a year, a housekeeping measure removing £2m from the staffing budget.
Using software to ensure the most efficient routes for Home to School Transport, saving £540,000 in 2025/26 and £720,000 over three years.
Reducing staffing in the Corporate Core as part of changes brought about through a new finance system, saving £480,000 over 2026/27 and 2027/28
Reducing energy costs for street lighting by an estimated £413,000 in 2025/26 by using recently-installed LED technology to optimise configurations for maximum efficiency.
Reduced mobile phone contract costs saving £116,000 in 2025/26.
Examples of transformation include:
Reducing the number of families placed in temporary accommodation by entering long-term leases, saving £1.6m over three years.
Bringing single homeless people placed in temporary accommodation in other parts of Greater Manchester back into in-house temporary accommodation in Manchester, saving £555,000 over three years.
Improving digital access to services, reducing the need for most costly channels, saving £450,000 in 2026/27.
Examples of service reduction include:
Reducing staffing levels in the Council’s Performance, Research and Intelligence team as improved IT and ‘self-service’ data and intelligence options for staff come online, saving £203,000 in 2026/27.
Reducing the libraries services and supplies budget by £50,000 through more efficient buying and a reducing events and public programme in district libraries. For context, the overall service and supplies budget is £1.8m.
Council tax
The consultation is asking Manchester people’s views on a council tax increase of up to 4.99% - a 2% precept to protect adult social care services, and a further 2.99% increase to invest in services for the most vulnerable and to help deliver on what people have told the Council matters most to them. The Government’s funding settlement calculations assume this level of increase.
Without the additional funding this increase would raise the Council would need to make £11.4m more cuts to services.
Manchester people on the lowest incomes get help through our Council Tax Support scheme which provides an up to 85% reduction in bills for working people and up to 100% for pensioners.
Council Leader Cllr Bev Craig said: “There’s no doubt that this is another tough budget-setting process which will involve some difficult decisions.
“We have done transformative work in areas such as social care, children’s services and homelessness to help people earlier and reduce the need for more costly support. Despite this, we are still seeing care costs surging in line with the rest of the country and will need to continue to innovate.
“All is not doom and gloom and I’m confident that despite the obvious challenges we are well placed to deliver. We have a clear focus on what we need to do. That means protecting frontline services which Manchester people rely on, from care services for those who need the most support to the everyday facilities which make our neighbourhoods good places to live such as libraries, leisure centres and parks.
“It also means continuing to make progress on long term missions to tackle poverty, build more affordable homes and help our residents through the current cost-of-living crisis.
Councillor Rabnawaz Akbar, Executive Member for Finance said: "Setting our budget is a balancing act. On the one hand we are determined to sustain essential services, give a helping hand to those who need it most and invest in the city’s future. On the other hand we need to make savings and generate more income to manage the considerable financial pressures we, in common with all councils, are under.
“We would encourage Manchester people to take part in this consultation to help us get the balance right. Refreshing our understanding of their priorities will help us get this balance right.”
The options will be considered at the Council’s scrutiny committees on 2-5 December inclusive.
Public consultation on the savings options identified by officers and council tax levels will run until 12 January 2025 and you can have your say here or by visiting www.manchester.gov.uk/budget
Feedback from the consultation, and from scrutiny committees, will be factored into the proposed budget put forward by the Council’s Executive in February next year. The final budget will be agreed on 28 February 2025.