Manchester looks to outsourcing as budget saviour

Manchester City Council today set out a draft list of radical cost-cutting measures to find savings of £169.7m over the next two years.

The council plans to save £108.8m in 2011/12 and £60.9m in 2012/13, a 25% reduction over the next two years. There will be 2,000 job losses at the council, with 41% of these managers.

Many services from housing to youth clubs will be considered for outsourcing to the private and charitable sectors. The authority's own corporate property needs will be reviewed, paving the way for a sale of surplus buildings although there was no clear target given for the amount to be raised.

Chief executive Sir Howard Bernstein's 'corporate core' departments – finance, culture, planning, housing, communications and personnel among others – will have to find £33.9m of savings, or 35% over two years.

The budget report outlines the impact on development and regeneration in the following paragraphs:

• Post settlement, we are taking a more radical approach by refocusing universal services such as Planning and Housing and moving services such as Culture, Crime and Disorder and the Joint Health Unit out of the Chief Executive's Directorate and into outward facing strategic directorates
• Planning and Housing will integrate their strategic functions to support the economic growth agenda and the work of Neighbourhood Regeneration Teams. It is proposed that the Housing service will be refocused and consider ceasing to directly deliver services. More detailed consideration will be given to the option of procuring a new service to manage all existing housing management functions. Any such proposal will require a review of current arrangements with third parties, compliance with procurement rules, consultation and an Executive decision.
• The Chief Executive also has a leadership role in relation to AGMA and (from 1st April, 2011) the Combined Authority. The Chief Executive will continue to take direct responsibility for city centre regeneration and will lead a centralised strategic development function. These roles will be essential in securing economic growth and enabling more Manchester people to contribute to and benefit from that growth.
• The core policy function will be strengthened on a hub and spoke basis, providing capacity for leadership of AGMA and the skills needed for new models of supporting private sector investment, e.g., Regional Growth Fund. This is key to the development of AGMA and the sub-region, but will be of particular benefit to Manchester residents.
• The regeneration function will be repositioned by the creation of Neighbourhood Regeneration Teams which will draw the support of core functions to neighbourhoods to support social and physical transformation. The strategic functions for housing, planning and transport will also be refocused to support the economic growth agenda.
• There will be a continued focus on the regeneration of neighbourhoods and a determination to avoid any detrimental impact on the achievements made by the City Council and its partners over the next 20 years.

The draft budget proposals will now be consulted upon before the council decides its final budget on 9 March.

The budget proposals can be viewed on the Manchester City Council website here.