Council tax rises by 5pc in Manchester
But cuts overall won't be as severe as first thought
Manchester City Council has announced its latest round of budget proposals as it aims to save £30m over the next three years.
A number of options were drawn up in October that would possibly help address a budget gap caused by the reduced government funding, an increasing population, inflation and other unfunded pressures.
This comes on top of continuing cuts since 2010/11 which have seen directorate budgets reduced by almost a third and £271m of savings and budget reductions made. In the same time, the Council’s workforce has reduced by 38% from 10,444 full time equivalent to 6,452 fte.
When the options were produced in autumn, the Council was anticipating a budget shortfall of between £40 and £75m over the next three years. Although the government’s financial settlement actually left the Council £1.2m worse off than anticipated, a review of resources available to support the budget has enabled the budget gap to be closed to £30m. This has included extra revenue generated through the city’s growth including £8.374m additional dividend from the Council’s share in the ownership of Manchester Airport Group and the use of £6.76m of airport dividend, which had previously been earmarked for capital investment, to help reduce the service savings required.
Now - following a consultation on those options which garnered more than 1,700 responses and taking into account the latest financial position - these options have been shaped up into firmer proposals.
Alongside the service budget proposals, there are also proposals for major capital investment in priorities including improving roads.
Council Tax Since the options were published, the Government has changed the rules to allow Councils to increase Council Tax by slightly more in the next two years to help pay for the increasing demand for services for older people and vulnerable adults.
The Council proposes to add the allowed three per cent adult social care precept in 2017/18 and 2018/19. This will raise £8.8m.
But as the Council proposes to put £30m extra funding into adult social care over the next three years to try to keep pace with growing demands, the money raised will only address a small proportion of the pressures.
In addition, Councils are allowed to raise Council Tax a further 1.99 per cent every year to support services. This will raise another £8.5m.
This will cover a permanent £2m a year increase in the highways budget with the rest more than absorbed by the Government’s new apprenticeship levy, which will cost the Council around £900,000 a year.
It is proposed that Council Tax will increase by a total of 4.99 per cent in 2017/18 and 2018/19 and 1.99 per cent in 2019/20. If we did not proceed with Council Tax rises, we would have to find £17.3m more savings.
Even after these changes, Manchester’s average Council Tax bill will be one of the lowest in country. The increase for Band A properties, which make up the largest proportion of properties in Manchester, would be around 77p a week in 2017/18.
The remaining proposals total £31.75m of savings. A comprehensive list can be found at
Sir Richard Leese, Leader of Manchester City Council, said: “The last few years have been very challenging for the Council as we have had to deal with continuing cuts at the same time as increasing pressures on services. This has been exacerbated by unfair government funding settlements which have hit big cities such as Manchester the hardest.
“But we remain determined to do all we can, working with Manchester people and other partners, to continue to protect the vulnerable and give everyone the opportunity to share in the success of the city’s growing economy.
“This budget process underlines this partnership approach as we attempt to strike the right balance which, inevitably, still involves some difficult decisions.”
Councillor John Flanagan, Executive Member for Finance, said: “Getting to this point has been a long and careful process because we want to involve the public as much as possible at every step. Between July and September last year Manchester people told us their priorities, which helped officers come up with their initial options in October. The consultation feedback on those options has in turn shaped the proposals. Now, as a final stage, we are putting these proposals to the public for their views.
“Manchester people have played a valuable role in shaping the budget so far. We’re grateful to them for their time so far and would welcome further input on the proposed budget.”
What happens next?
The next stage of consultation on the budget 2017-20 now begins, asking people to comment on whether they agree or disagree with the detailed proposals. For more information and to take part, visit The consultation runs until 10 February.
The final budget for 2017/18 to 2019/20, taking into account the responses to this consultation, will be set at the full Council meeting on Friday 3 March 2017.