Andy Burnham gets millions in budget, but councils still in limbo

Big news for Greater Manchester was announced in the budget this week. For the first time, mayor Andy Burnham will be able to spend money according to his own priorities with a single pot of funding to be agreed over several years.

 

Read more: Greater Manchester given powers over trains, housing and skills in historic new devolution dealPublished: 16 March 2023
Andy Burnham will get full control over his budget, government saysPublished: 16 March 2023

 

The new devolution deal – described the ‘deepest’ yet – also give local leaders more powers over transport, housing and technical education. But the biggest change is the financial certainty and flexibility that the ‘trailblazer’ deal offers.

The move means that the city-region will be treated like a government-style department with more financial freedom than the current arrangements allow. “We’ll be able to do more of what we want to do,” Mr Burnham explained, “rather than dance to the tune of the individual government departments who are often putting lots of conditions on the funding pots that they give out.”

Councils of all colours across Greater Manchester have welcomed the new deal. However, their own finances have hardly been affected by this budget.

One-off funding was awarded for projects across the city-region including several schemes which failed to win Levelling Up money earlier this year. Meanwhile, local authorities are set to benefit from extra cash to cover rising costs for swimming pools as well as a £200m increase to the pothole fund.

The Chancellor also announced that places like Greater Manchester can keep more of the business rates councils collect, extending existing arrangements. This ‘long-term commitment’ to continue the 100% business rates retention scheme which was trialled, gives local authorities more financial certainty.

Nevertheless, day-to-day spending for councils continues to be a concern. Councils are typically told how much funding they will receive in the next financial year a few months before it begins, in the week before Christmas.

For years, councillors have been calling for multi-year funding settlements of the kind that Greater Manchester mayor Andy Burnham has now secured. This would give local authorities greater certainty and help them plan for the future.

Increasingly, councils rely on raising council tax to balance the books. But this hits the poorest parts of the country hardest, Labour councillors argue.

In Manchester, the latest local government financial settlement announced in December was better than had previously been expected. But the Labour councillors who run the city have warned of a ‘cliff edge’, accusing the government of ‘playing politics’ by delaying the most difficult decisions.

The leader of Manchester Council, Bev Craig said the Conservatives have ‘kicked the can down the road’ because they may no longer be in power when that ‘cliff edge’ comes. Commenting on the latest budget announcements, she said: “Devolution has received a boost with the trailblazer deal for Greater Manchester, and the move to a single, multi-year settlement is a welcome move.

“In local government we have long argued for a single, multi-year settlement on the basis that it enables better planning and better outcomes over the longer term. Under devolution, local councils are still trapped in single-year, complex funding arrangements and we will continue to push for single settlements across several years for local government too.”

Responding to claims that ‘difficult decisions’ on council funding have been delayed, a spokesperson for the Department for Levelling Up, Housing and Communities said: “We recognise the pressures councils are facing and have made available £60bn for councils in England in the next financial year. This includes an increase of up to 10% for councils in Greater Manchester, which could bring their Core Spending Power to almost £3bn in 2023/24.

“This spending boost is providing the support and funding councils need to continue delivering first-rate public services, while also prioritising social care with £121m in additional social care grant funding for Greater Manchester in the next financial year. Councils are responsible for managing their finances and making decisions for the people they serve.”

Joseph Timan, Local Democracy Reporter