Greater Manchester council budgets cut by a quarter on average, research reveals

Councils in Greater Manchester have had their budgets cut by nearly a quarter over the last 14 years, according to new research.

Across England, the poorest councils have faced real-term cuts worth almost three times as much as the richest local authorities, the research by a special interest group has revealed.

SIGOMA, the Special Interest Group of Municipal Authorities, found that the biggest real-term cut to a council in Greater Manchester was nearly 30% as Manchester council’s budget is now worth 29.9% less than it was in 2010/11 financial year when the figures are adjusted for inflation.

SIGOMA has also revealed that Oldham and Rochdale have faced real-term council cuts of 29.1% and 28.4% respectively. Stockport council’s budget is said to be worth 17.9% less now while Trafford’s is down 21% in that time.

Meanwhile, Surrey County Council, where Chancellor Jeremy Hunt is an MP, saw spending power fall by 8.3% during the same period.

The data shows that the 10 richest councils in the country received a 10.1% cut on average while the 10 poorest councils in England faced a real-term cut of 28.3%.

Barnsley council’s Labour leader Stephen Houghton who chairs the SIGOMA – a group which all councils in Greater Manchester belongs to – said the current funding model tends to reward areas with high-value housing and thriving businesses.

Sir Stephen said that this has resulted in an increased disparity between the wealthiest areas of England which rely less on grant funding and can raise more from council tax, business rates and other funding sources.

He said: “The poorest areas have seen the biggest cuts and for ‘levelling up’ to mean anything the government should be looking to reverse these cuts and create a funding formula that funding according to council needs.”

It comes as SIGOMA unveils a new manifesto titled ‘For a Sustainable and Fairer Future’. The manifesto suggests a series of local government reforms.

SIGOMA’s research found councils in Greater Manchester have faced an average real-term cut of 24.5%. Each council has been affected as follows:

• Bolton -25.3%
• Bury -22.0%
• Manchester -29.9%
• Oldham -29.1%
• Rochdale -28.4%
• Salford -22.9%
• Stockport -17.9%
• Tameside -23.3%
• Trafford -21.0%
• Wigan -25.1%

Neil Emmott, leader of Rochdale Borough Council said: “Over the last 14 years the council has been forced to make savings of £188 million following significant reductions in government funding, and while further efficiencies are identified that have the least impact on our residents, there are going to be more difficult decisions to make.

“The impact of the pandemic, inflation, energy prices and the cost of living crisis has made this even harder and although demand for our support and services has increased, our government funding continues to be severely affected.

“We have learnt lessons, become more efficient in many areas and seen many strengths in our communities, but there has been a serious and disproportionate impact on Rochdale.

“I certainly welcome this SIGOMA call for fairer funding and want to see more evidence that the government is committed to levelling up.”

The Department for Levelling Up, Housing and Communities was contacted for comment but declined due to restrictions during the pre-election period.

Joseph Timan, Local Democracy Reporting Service