Better Safe than Sorry
Setting the annual budget is by some way the most important decision the City Council makes so it would be remiss of me in extreme not to remark on today's Executive Committee meeting when the Executive's 2012/3 budget proposals were agreed. This is one of a number of staging posts in the budget setting process. The next stage is in twelve days time when the budget proposals and any proposed amendments will be subjected to scrutiny by the Council's Resources and Governance Overview and Scrutiny, and then finally the budget goes to budget Council on March 7th for approval ( subject to any amendments agreed ).
Perhaps surprisingly given the cuts context, the 2012/3 budget is, compared to most years, relatively straight forward. That's mainly because all the big decisions were made a year ago. We knew then what grant support we could expect over the two year period and set a budget accordingly - making the hard decisions then. The first year of that two-year budget has now been navigated without significant variations which means, sticking with the nautical metaphors, it's very much steady as she goes for year two. There are some changes. When the budget was approved in 2011, the Council agreed that if any more money should become available it would go into early years, families and vulnerable adults via the Manchester Investment Fund. Some savings were achieved faster than anticipated which allows us to put around �8m into the fund, which will largely be spent on work with complex families, work which if successful will not only be good for those families but will also save the Council and other public agencies money later down the line. Some budgets like that for looked after children are very much demand led and small fluctuations in numbers can blow the budget badly off course so we have created a small reserve to hedge against negative changes mid-year. The executive also propose putting some money back into street scene management creating twenty new apprenticeships at the same time.Lastly on this, there will be a Council tax freeze for the third consecutive year.
Of course, whilst setting the budget for 2012/3 we also need to look ahead to future years. The government have already indicated in their Comprehensive Spending Review that local Councils will face further cuts in 13/14 and 14/15. The Chancellor in his autumn budget statement indicated that there would be even more cuts the two years after that. What we really don't know is what the impact of those cuts will be on Manchester, how the cuts will be distributed. So the City Treasurer has put together indicative figures showing the need for a range of savings of between �55m and �80m for 2013/14/15. It doesn't mean that's what's going to happen, but if we are to continue to manage the Council's finances prudently, they are the assumptions we need to use to plan ahead.