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Feb 2019

I am here today to recommend that Council approve my budget for 2019/20. This is my third budget as City Mayor for Salford. It is a City I continue to be immensely proud to serve.
The City Council continues to face a significant challenging financial situation, which impacts directly on the services we are able to deliver to our residents and the people employed in our city to deliver services.

I believe this budget represents as far as possible a responsible and fair set of proposals.

Let me first outline the main technical elements of the Budget I am presenting to Council today. I am recommending an overall revenue budget of £205.241m for 2019/20. I am also recommending a capital programme of £105.682m for 2019/20, using the resources set out in part 3 of my report.

In accordance with the formal resolutions set in Appendix 6, I am proposing:
• A council tax requirement of £107.909m, in accordance with the legislation;
• a basic amount of council tax of £1,577.32 and an amount for each valuation band in accordance with the legislation
• an amount of council tax for each valuation band in accordance with sections 30 and 36 of the Local Government Finance Act 1992
• I am also recommending that Council approves the Housing Revenue Account budget for 2019/20 as set out in Part 2 of my report.
• Finally from a technical point of view, I am recommending that Council approves the treasury management prudential indicators for 2019/20 to 2020/21 as set out in Part 4 of my report. I now want to turn to the main part of my speech today

Make no mistake!!! The financial challenges facing this council continue to be significant. Despite national government statements to the contrary, austerity is far from over for local government. In the nine years of this Government Salford – this Council will have had to find savings of £211m by the end of 2019/20.

These savings are driven by cuts in government funding of over 50% in that time period. No council – no organisation – can lose 50% of its funding without a direct impact on services. In fact, if this was a private sector business we would have most likely been forced to cease trading, the liquidators would have been brought in and we would have had to make all members of staff redundant!

In 2019/20 alone we have had to find further savings of £13.06m in order to deliver a balanced budget. I believe we have approached that challenge responsibly and earnestly, with the Mayoral Team working all-year-round to bring this year’s budget to Council.

It is not a challenge that either I or my Mayoral Team have taken lightly. Nor do we take any joy from the proposals before you today. We cannot pretend that austerity hasn’t hit this City Council and the people of our City hard.

The national context behind all of this, is a government that continues to conceal the impact of its funding decisions on the public. It is a government that fundamentally does not believe in the redistribution of wealth via taxation, that believes both personal and regional poverty is due to people’s own actions, and is seemingly unmoved by the depths of misery it has inflicted on the public after 9 years of austerity.

As a nation, we are condemned by the United Nations for policies which are depriving children of food our own studies here at Salford Council have shown how welfare reform is creating ‘hidden young people’ in our city, living from the proceeds of petty crime, cash in hand jobs and living through spates of homelessness. The Government’s economic plan has been roundly condemned by the international economic community.

Austerity has been criticised by the IMF, by the WTO, by the World Bank, as well as dozens of leading economists from around the world. It has even been condemned by the government’s own Office for Budgetary Responsibility, the government organisation set up to enact an austerity agenda post the 2008 crash.

Nationally, our infrastructure is failing, decimated by years of privatization and the burgeoning bureaucracy which has arisen from the fragmentation of service provision as a result.

We are seemingly incapable as a nation of delivering on key projects: HS2, Crossrail, the Garden Bridge, smart motorways and so much more and this government is addicted to high-status vanity projects rather than the nitty gritty of infrastructural improvement required, for example, to ease traffic congestion in cities like Salford. Do we want to flat BCR issues the Treasury operate?

Salford is the 22nd most deprived local authority area in the country, according to the government’s own indices of multiple deprivation.

Since deindustrialization in the 80s and 90s, Salford – and many former industrial areas like it – have struggled to develop alternative high-skilled well paid economies, as successive national governments have predominantly focused their attention on London and the South East. Combined with the Tories cruel and corrupt measures to give money to their own constituencies, the people of Salford have been utterly abandoned by this government.

Take the ‘Fair Funding Review’ as an example: much lauded by the Conservatives at their recent Party conference and heralding ‘the end of austerity’. We were told this was a process designed to make funding more equitable, in fact it was a cheap excuse to pander to the Home Counties by enhancing the role of ‘rurality’ in designating funds, and removing considerations of deprivation. Let me repeat that point: it is currently being proposed, in the Fair Funding Review, that ‘deprivation’ is no longer considered to be an important methodological factor in allocating resources, with the government favouring an allocation of funds on a per head of population basis rather than actual need.

Just to reiterate: the Fair Funding Review, with an emphasis on ‘Fair’, is proposing that it is no longer important to consider the relative deprivation in different local authority areas when allocating funding.

Further than this, the government’s Fair Funding Review deems it more important to consider the specific needs of rural constituencies, constituencies which on average have far higher personal and household incomes, than it is to consider the needs of those who are truly suffering:
As millions queue up outside foodbanks,…
…children arrive at school without being fed,
…the homeless are forced into temporary accommodation, night shelters, with many sleeping rough on our streets, with no place to call home!
…our hospitals are falling into disarray, with our doctors, nurses and allied health professionals working under unsustainable pressure
…police are buckling under the pressure of huge increases in crime
…and whilst local authorities are declaring bankruptcy,…
…government is more concerned with stuffing money into Surrey, Cambridgeshire and Buckinghamshire than it is with tackling these urgent issues.
If that wasn’t enough, another mechanism for diverting money back into the wealthiest areas of the country has been proposed: Negative Revenue Support Grant (RSG).
This is the idea that wealthier areas that contribute more to the RSG pot should get more out to cancel out the supposed ‘disparity’,
…fundamentally undermining the redistributive rationale of the Revenue Support Grant.
It is a policy designed to even further entrench inequality between regions and localities.

Given these factors, our approach to this budget has been objective, detailed and open.
• We have listened to the public through our ‘Talk Budget’ engagement about the things that matter most to them.
• We have sought to protect vital services for our most vulnerable residents – reflecting our overriding commitment to a better and fairer Salford.
• We have undertaken a detailed review of all service budgets across the council – this has involved members, directors, our employees, trade unions and key partners.
• We have reviewed central provisions and the council’s financial reserves – and how these could be used to support the protection of vital services.
• We have sought wherever possible to maximise the opportunities from new transformational savings, efficiencies, new partnerships, and additional income.

This is a city I am immensely proud to call home – and I believe all members share that pride. It’s a city with a proud identity, an incredible history and tight-knit community. A city which despite the obstacles, is still on the path to growth and succeed.

The decisions this council has taken over the past few decades to invest in the regeneration of the city are beginning to pay their dividends.

Business rates have increased by £2.7m annually in the past 2 years, council tax by £13.5m. We have collected £16m in section 106 contributions since 2014 and £48m New Homes Bonus between 2014/15 and 2019/20.

This money is a lifeline, without it our services would be hit even harder by the cuts.
Ambitious investment in Greengate and New Bailey is building the council’s asset-base, bringing in an anticipated £7.5m profit over the next 25 years plus generating jobs and business rates building the economy of Salford. Our City Council is not simply sitting back and watching as Tory under-funding drives us into decline – we are building and investing for the future of our city and its people. But despite gains, we simply cannot recuperate all we have lost through local rates.

In line with expectations and spending calculations from the Ministry of Housing, Communities and Local Government (MHCLG) and the Treasury this year we are inevitably being forced to increase Council Tax by 2.99% and the Adult Social Care precept by 1.00% as we still wait for a Green Paper on how government intend on tackling the crisis in social care nationally.

This raise helps in covering the increasing costs of children in care (up £9.1m since 2010) as well as discretionary support services, winter fuel packages and care for the elderly.
These services are vital – without them, Salford residents would be facing destitution and in some cases even death.

High quality health and care services are absolutely vital for our residents – and for the economic and social future of this city. That is why I am including within our budget approach proposals for greater joint working between the Council and Salford NHS Clinical Commissioning Group (CCG).

We are fortunate to have an outstanding CCG and Hospital within our city. We already have a strong history of working together to improve the quality and effectiveness of health and social care. With the CCG we want to build on that strong history and have brought forward proposals to create a £600m Integrated Fund for Health and Care bringing together much of our mutual funding for Children, Adults, Public Health and Primary Care.
Our proposals are ground breaking – once again Salford will be leading the way nationally in innovation and new ways of working to protect vital services for our residents.

We are not waiting for the Government or anyone else to show or tell us how it is done.
These reforms are essential to best protect both health and care services for our residents.
By bringing our resources together, under clear and robust joint decision making arrangements, we can achieve improved health and social care outcomes for residents in the city; commissioning more integrated and proactive care – making sure people can see the right professionals, in the right place, with the right skills and experiences; protect front line services, making better use of our limited resources; and deliver improved quality, safety and outcomes for patients.

This builds on the proven track record through our pooled budget arrangements with the CCG for adults. An arrangement that allows us to realise £1.8m towards our budget challenges in 2019/20 through an agreed reduction in the council’s contribution.Savings in
Public Health will be made through changes to and re-specification of contracts.

We are working to minimise the impact on residents and ensure public health services continue to support the most vulnerable in our city. I can reassure Council that our further integration proposals do not involve any transfer of functions, responsibilities or staff to the CCG or to a separate new organisation.
The Council will continue to hold its responsibilities for the provision, safety and quality of Children’s Services.

What we are doing is ensuring we can make the most of the skills, expertise and capacity of both organisations, and make the best possible investment decisions to ensure we keep the right high quality health and care services in the city.

Last year I spoke of the national crisis in funding for Children’s Services. 12 months on – that has not changed!

The impact of welfare changes, new burdens on councils as a result of Government policy and legislative changes, and the growing numbers of children in our city – continue to mean growing pressures on council budgets for Children’s Services. Despite clear evidence from Salford and councils up and down the country – the Government continues to fail to provide anything like adequate levels of funding.

We invested an additional £4.5m in our services for Children in 2018/19 in recognition of the significant pressures faced in order to meet the needs of children and their families. This was a decision to invest in our residents.

Despite this investment, this area of our budget continues to face ongoing pressures.
But we will continue to make decisions for children, young people and their families based on a professional assessment of need.

Whilst the service will contribute £1.9m of savings as a result of proposals made today, we will continue to prioritise early help and prevention, and high level statutory intervention where that is needed. Our investment in core services such as street cleansing, highway maintenance, the upkeep of parks and the city’s fantastic open spaces, leisure, planning and building control will continue supporting the essential fabric of public life in the city. These are all things that residents have told us matter to them.

We continue to invest in our libraries and leisure facilities in order that Salford residents can enjoy the leisure and cultural offer which contributes to health and wellbeing and make Salford such a vibrant place to live and work in. We are taking advantage of capital investment to purchase electric vehicles for our operational services – such as for our dog wardens and pest control services, investing in better air quality and a reduced carbon footprint from the council’s operations.

Every organisation needs strong enabling and support services – enabling the front line to focus on delivery. But those support services need to be as effective and as efficient as possible. This is as true for Salford Council as it is for any large organisation.

We are committed to reviewing transactional services across the organisation – maximising use of new technology and automation to realise efficiencies and enabling staff to provide greater face to face support to residents – something we know is important to residents.

At the core of the organisation we will continue to provide effective financial planning and stewardship; workforce and organisational development; digital development; a cohesive communications strategy; and the effective management of legal, democratic, elections and strategic procurement functions. These functions will continue to work cohesively so as to ensure we can protect investment in frontline services. After 9 years of austerity and consistent cuts, this year’s budget is the hardest and most painful to date. We have been cutting to the bone for several years now – and many decisions have been taken from necessity rather than choice.

We could not deliver the high level of service we provide to our residents if it was not for the commitment, pride and passion of our own council staff. They too have felt the impact of austerity – throughout this time our staff have remained totally committed to the residents of the city. For that I thank them for their dedication and commitment to the work of this City Council and the people of the city.

This, as I am sure many in this chamber will agree, is a horrendous reality to be faced with for a Local Authority.

It is though incumbent on us to set our priorities and our corresponding budget locally – and so I ask Council to agree the budget before them today.