Canal27ways

Category: Trafford Budget 26

  • Setting Trafford’s Budget Pt 8 The Budget is published.

    Setting Trafford’s Budget Pt 8 The Budget is published.

    The Final Budget has been published, ready to be put to council on the 5th March.

    Trafford Council Budget 2026-27.

    In terms of spending choices, as one would expect there’s not a huge difference from the draft budget released in January. The proposed net budget is £274m compared to the £277m originally projected, which is good. It’s about the only good thing on show.

    We knew that the Government had determined that we needed to be able to increase Council Tax by an additional 2.5% compared to the standard rise. That 7.5% is therefore built into this final budget.

    We’ve been granted the facility to borrow £12.64m for the coming year. This is on top of borrowing £9.6m or thereabouts for the year that’s coming to an end.

    Borrowing is not routine, it’s a seismic change.

    The act of borrowing to support day to day spending has always been outlawed and rightly so! I don’t like it at all. Fundamentally, it’s borrowing from future budgets. It’s particularly worrying when future finances do not look any rosier.

    Given this is a three year settlement, you would hope we could see light at the end of the tunnel, but there’s no sign yet of a balanced budget, albeit there is a narrowed gap in 2028.

    I learn from the local democracy reporting service that Sefton is looking to a fire sale of assets to balance its budget. This seems to require Government permission.

    Liverpool Echo Sefton selling off assets to balance budget

    Trafford hasn’t committed using receipts from its land sales. However, the land sales plan routinely contains the paragraph:

    Receipts generated from the disposal of sites as detailed in Category 1 and returns from development of sites detailed in Category 2 are currently earmarked to directly support the Capital Programme, although these could also be used to support the wider strategic management of Council borrowing.

    They’ve not used receipts before, as far as I am aware, to support the management of borrowing, but we’ve never been in this position.

    The more I think of Trafford, Warrington, Cheshire East and Sefton, the angrier I get on their behalf. I can’t believe how passively we’re all accepting this absolutely dreadful settlement from Government.

    Yes, there’s an argument that our council tax level in Trafford is somewhat adrift from what it really ought to be to deliver the standard of service people want, but the comparison with Manchester’s settlement is just too extreme. The difference that’s going to become apparent between Old Trafford and Whalley Range is so unjustifiable it needs to be screamed at Government. I’m appalled.

    Budget Documents

    The 26/27 Final Budget Proposals (109) pages
    Key Parts –
    Report of the Director of Finance and Systems on the
    Robustness of the Proposed Budget Estimates and the
    Adequacy of Financial Reserves (Page 9)
    Financial Background (Page 33)
    The Budget – Page 59
    Savings Proposals – Page 86

    Capital Spending

    Treasury Management (Debt and Reserves)

    Fees, Charges and Allowances (everything from parking to cremation charges)

    Budget Scrutiny Response These are the executive’s answers to the recommendations of the scrutiny committee.
    (The Scrutiny don’t seem to have been given access to questions over financing the budget gap. It’s certainly not raised.)
    Given that effective scrutiny was particular emphasis of the peer review of Trafford, I don’t know that this serves Trafford.

  • How are other councils doing?

    How are other councils doing?

    What have we done to deserve this?

    The Government’s settlement for local government has left some councils in a desperate situation, whilst others are busily working out how they’re going to spend the extra money.

    I don’t have to be polite. This is a ridiculous way to proceed. You’re not going to get value for money at either extreme.

    Nevertheless, we’re in the spotlight. Are we going to get a visit from the Government inspector? The Bishop of Bath and Wells?Are we on our own?

    It’s bleak for us.

    So, what about the councils around us?

    Manchester

    Core Spending Power increases from £786m to £874m, an 11.2% increase. This core spending power equates to £1438 per person.

    The budget papers go to scrutiny on Monday 23rd February.

    They’re very pleased!

    This is a positive settlement for Manchester, by 2028/29 the Council’s overall CSP is forecast to be around 32% higher in cash terms and 24.2% higher in real terms then 2025/26. After accounting for projected population growth this translates to an average 22.9% real terms increase in funding per resident.

    Salford

    Core Spending Power increases from £399m to £424m, a 6.3% increase. This core spending equates to £1431 per person, not a great deal less than Manchester’s.

    The budget goes to cabinet tomorrow 17th February. They’re very pleased!

    This settlement marks a fundamental shift in local government funding, with significant redistribution,
    new formulas, and a move towards consolidated grants. This settlement will result in the most significant redistribution of funding within the sector in the last 25 years.

    Warrington

    Continuing anti-clockwise around Trafford’s border we come to Warrington. Like Trafford, Warrington has been allowed to increase its council tax by 7.99%.

    Core spending increases from £237m to £242m, a 4.5% increase. This figure is calculated before the extra 2.5% council tax is applied, but it’s noteworthy that the increase in core spending is already less than the increase in council tax. This core spending equates to £1109 per person, substantially down on Manchester and Salford.

    Their budget plan goes to scrutiny tonight (16th February). There’s an open acknowledgement they’re in serious difficulty. Their 3 year budget gap has increased from £90m to £130m since December.

    It’s fair to say they’re in a perilous position as their cabinet member for finance explains in the accompanying press release.

    This is almost a confessional to a person holding a hot poker.

    The reports published today detail that our difficulties stem from inadequate budget control, an over-ambitious commercial approach, and several years of unaudited accounts.

    We are victim to national issues, such as rising demands and costs for some services, particularly services that support our young people, families and older adults.

    But specific local issues have also played a significant role in driving our budget issues.

    In recent years, instead of making difficult service cuts when many other councils did, we have relied heavily on income generated from our commercial activity. And, while our commercial portfolio has provided a surplus of around £166 million since 2009, all of this money has been used towards covering successive budget gaps.

    Cllr Denis Matthews, Cabinet Member for Finance, Warrington Council

    Cheshire East

    Continuing our trip around the councils that border Trafford, we come to Cheshire East. Their town hall is based in Macclesfield, but the local authority area comes right up to the outskirts of Altrincham. Cheshire East is in the unenviable position of having a request to increase its council tax refused by government. They wanted a 9% increase but have not been granted any dispensation beyond the standard 4.99%. Politically, they’re facing a vote of no confidence.

    Core Spending Power increases from £430m to £452m, a 5.2% increase. This core spending power equates to £1062 per person.

    Cheshire East are recognising that even with Government support via EFS this is a difficult position.

    The section 151 officer issued the following statement of assurance on the authority’s financial position:

    Assurance Statement of the Chief Financial Officer

    1. The risks in the 2026/27 budget are predominantly in relation to costs associated with demand in Adult and Children Social Care, the delivery of the Improvement and Transformation programme and the Council’s position on the DSG deficit.
    2. Moreover, the inadequate level of general reserves will require the Council to continue to rely on the provision of EFS in order to balance the budget for 2026/27 and future years.
    3. This is not a financially sustainable position and the financial challenges for the Council remain acutely difficult. It is only with the support of EFS that the
      Council can set a balanced budget and this is not a sustainable position.

    Trafford

    Core Spending Power increases from £247m to £251m, an exceptionally paltry 1.9% increase. This core spending power equates to £1041 per person which is the lowest of all these councils.

    The draft budget is due to be published tonight. Of the four councils that border Trafford, two are in a parlous position and two are in clover.

    Trafford has by far the lowest financial spend of the five councils, yet it collects the most per person when you add in business rate collection.

    Some of the negative comments I’ve seen on social media about the financial challenge are a disgrace and there’s a significant political opportunism from people that should know better.

    Trafford’s predicament is not one of a spendthrift council. One might argue that council tax was so low that it prevented sufficient flexibility in the reserves.

    The graph below shows how Trafford has always lagged its neighbours in terms of council tax. Note the uppermost plot is the England average. All these local rates are lower than the average.

    AI generated image by the author using Gemini

  • Setting Trafford’s Budget Pt 7

    Setting Trafford’s Budget Pt 7

    My previous post on setting the budget ended with the words,

    Over to the Government

    All options are possible: worse, same or getting better.

    Fingers crossed.

    This was the week we found out.

    Monday – I hate Mondays

    The final settlement for most local authorities was published.

    The key figure is the 1.9% increase in core spending power. This is based on Council Tax increasing by 4.99%. Yet local budget pressures are increasing by 18.81%. There’s a considerable gap.

    The Govt recognised that the ceiling of 4.99% on council tax increases would place Trafford in an extremely difficult position and has consequently granted the facility to make an additional increase of 2.5%.

    It’s at this point that the proverbial hit the fan. The fact that Trafford is one of a small number councils requiring this facility has shocked residents. Social Media has been on fire. It’s not been pleasant.

    It’s hard to disagree with lots of these comments. The council tax increase is not going to result in notable improvements to service. The truth is that we’ve been hit by changes to the formula used by government to determine the distribution of centrally held funds.

    Areas with high levels of deprivation have benefited from both increases to core funding and a recovery grant that’s given a substantial pick-me-up to most of our neighbouring councils. Only Stockport along with ourselves have missed out. Stockport has a much, much higher council tax with which to absorb this discrepancy. Trafford’s low council tax has kept us lean, but it’s left us incredibly exposed in facing this perfect storm.

    We’re going to have borrow

    This really worries me. We were given facility to borrow £9.6m to support this year’s budget, and it looks like we’ll be utilising most of it. We’re awaiting news of what the government proposes the facility will be for next year, but it could be more than last year.

    I’m standing down in May and I hate the idea that I’m passing debt onto my successors because we didn’t have enough to pay for day to day spending. We’ve surely got to do as much as we can to limit this borrowing.

    If we were able to set our council tax to the average level, we’d be able to avoid borrowing, but that would require an increase of about 17%. Despite it being the normal rate elsewhere, Trafford residents would not weather an extra 17% increase.

    So where does that leave us?

    Councillors will have to take the hit what is really an unsatisfactory compromise – unwelcome increases in council tax, a level of service that doesn’t meet expectations and increased risk of much worse as the debts begin to accumulate.

  • Getting tetchy!

    Getting tetchy!

    I read a really good piece in the Manchester Evening News by Hannah Richardson. It captured perfectly the mood of Trafford Council.

    The Conservatives blamed Labour, Labour blamed the Conservatives, and the Greens pointed the finger at every other party present.

    Hannah Richardson MEN
    Manchester Evening News

    We’re still waiting for the Government’s decision. It normally lands by the end of January, so everyone’s feeling a bit on edge.

    Somerset Council has already had to postpone their budget meetings in the absence of the final settlement.

    One can imagine that the team led by Nico Heslop (Director of Finance) at MHCLG has had its work cut out in listening to the protestations of councils like Trafford over the proposed settlement.

    My guess is that we will learn our fate this week. It will be good to channel all this nervous energy into constructive activity.

    The Conservatives as main opposition party will want to put an alternative budget forward. The other parties might want to propose tweaks. They clearly need to see the Labour budget first.

    If the law dictates that it all has to be done and dusted by March 11, we really need that final settlement agreed.

    Link to Manchester Evening News Article on the Council Meeting of 28 January 2026

  • Setting Trafford’s Budget – it’s over to the Government

    Setting Trafford’s Budget – it’s over to the Government

    There’s been a couple of meetings this week. We’ve had the formal posting of the Draft Budget at the Public Executive. That was followed by the first meeting of scrutiny committee in relation to this year’s budget.

    Normally, the scrutiny committee would have begun looking at this much, much earlier. They’d have looked at options and they’d have looked at the longer term context. Personally, I regret the omission of that earlier work. Scrutiny would have added to the case being made to government. We are where we are and I’ll leave that particular issue at that.

    The Executive meeting was rather long, but the draft budget was formally adopted. This means we’ve set a balanced budget only on the basis of a £20m facility to borrow, that can only be granted by government in the form of Exceptional Financial Support(EFS).

    It’s now down to the government whether to grant EFS in the form we’ve proposed (a loan) or in some other way. There’s an intense dialogue ongoing with Government and lobbying alongside our MPs. That won’t let up, but the government is moving from consultation to finalising the settlement and tabling the regulatory instruments.

    I have no idea what to expect from Government and there is nothing to be gained by speculating at this late stage.

    Let’s hope that there’s a route that puts us on a sustainable financial footing.

    I did receive responses to the questions set out in the 5th piece. My verdict on the budget for children’s services being tight was conceded. We’re at a place where all the budget lines are tight. I think we just wait for the settlement now. All options are possible, worse, same and getting better. Fingers crossed.

    Photo by Suki Lee: https://www.pexels.com/photo/close-up-of-hourglass-14826119/

  • Setting Trafford’s Budget Pt 5 – Spending

    Setting Trafford’s Budget Pt 5 – Spending

    Essentially, spending is the very core of the budget process. We’re describing how much the council intends to spend and setting out to raise sufficient income to pay for it.

    Councils know there are limits to how much income they can generate, both in terms of the rules and in terms of democratic oversight.

    If Council Tax is too high, the voters will vote for a party that pledges to tax a more reasonable amount.

    Voters also expect to see the benefits of the taxes that the council is taking. They want clean streets, the bins emptying, roads maintained. But it’s not just the state of the place, they don’t want to learn that their elderly neighbour has starved because no one was caring for her. Voters get this, although I don’t think we make it easy for people to see where their money is going.

    So anyway, the council sets out its projected spend by service*. We’re only going to need look at two tables:

    • A chart comparing spend by service in the current year with that projected for the coming year in the draft budget
    • Page 84 of the Draft Budget which is titled ‘subjective budget analysis’, but is actually a single table detailing all the changes to spend and why they’re happening.

    *brief descriptions of each service stream are at the bottom of this post.

    The first chart

    With the publication of the draft budget, we can compare the budget for the coming year to what we’re looking like spending in the current year.

    It’s not possible to provide a completely ‘like for like’ comparison. This is where that 2nd chart referred to above is particularly useful. We can see changes to and between funding streams. So, on that chart, there is an unassuming line ‘Grants, Legislative and Service Transfers’, that accounts for £29m of the increased budget costs.

    The explanation is that the government have moved away from many individual grants and rolled them up into being part of the main allocation. This means the cost needs to be brought into the budget

    This has particularly affected Adults and Wellbeing as it’s added £26m to the budget with the other £3m being attributed to ‘Council Wide’ provision. Given the main allocation which is referred to here as ‘business rate’ funding is only increasing by £23m, there’s a shortfall in the funding from government. That’s one aspect that’s made this a particularly difficult budget.

    Nevertheless, in terms of scrutinising the spending plans, it would seem fair to test some of the assumptions.

    Possible Questions for the Executive at Scrutiny

    • That Children’s Services budget looks ambitious. It’s normal that controlling the cost of children’s services that gives the council the most difficulty. What assurance can we have that a 3.77% can be constrained?
    • Legal and Governance seems to be getting quite a large increase of 10.18%. The bulk of this increase is just described as ‘other’. Can you provide more details?
    • Place is receiving a large increase of 11%. Are we expecting to see improvements to delivery? It’s primarily attributed to the Strategic Investment Programme. What will be the visible returns on this investment?
    • The Adult Services budget is seeing major changes with a move away from grants. We’re allocating that loss of grants (£26m) to the main budget. Given we’re not being compensated in business rates to the same level, would we not be justified in reducing the provision to a level commensurate with that now provided? What would be the effect?
      In any event how are we going to monitor this provision in the absence of grant funding for which monitoring would be standard.
    • I think we’ve also got to monitor head counts. We’ve invested quite a lot over the years in IT and efficiency. We don’t usually receive details of head counts, but I think the very fact we’re having to apply for support means we’ve got be transparent.

    Appendix
    Trafford’s service headings

    As a quick addendum, I just wanted to provide this brief description of service headings. Do we need quite so many? I’ll leave that for another day.

    Children’s Services

    includes a vast range of support services designed to help children and young people who need extra support.

    Adults and Wellbeing including Public Health

    a vast array of services many of which are statutory under the care act 2014

    Place

    The Place directorate provides all those services linked to buildings and the ‘place’ we live in. From bins to planning.

    Strategy and Resources

    Typically, things that Trafford operates as entities such as libraries and bereavement services.

    Finance and Systems

    IT and financial management activities

    Legal and Governance

    Registrars, Legal

    Council-wide

    Includes Asset Investment, Council Tax Support, Treasury management