The Resources and Governance Scrutiny Committee met to discuss several key issues, including the city's anti-poverty measures, the upcoming budget process, and the performance of the Manchester Energy Network. The committee also reviewed the Revenues and Benefits Unit's activities and approved the minutes from the previous meeting.

Passageway Cleansing Contract

The committee endorsed the decision to award a contract for passageway cleansing services to Redgate. Councillor Leech called in the decision, not necessarily disagreeing with it, but to raise questions about how the service would improve and be monitored. He noted residents' concerns about back alleyways and questioned the cleaning inspection regime, citing instances where inspections were lacking or cleaning was not done after inspection. He also queried the current pass rate for inspections and welcomed the contract's requirement for photographic evidence of works.

Councillor Leech also raised the issue of residents and businesses placing bins in passageways and the impact of rear extensions on waste management. He suggested assessing the practicality of long-term insourcing of the service in the future.

The Strategic Lead (Waste, Recycling and Street Cleansing) explained that the previous contractor lacked the necessary equipment, causing service fragmentation. Redgate had been taking on additional referrals, making them a better fit for the contract. Increased demand for passageway cleansing was attributed to population growth and flytipping.

The Strategic Lead (Waste, Recycling and Street Cleansing) highlighted the Key Performance Indicators (KPIs) attached to the contract and stated that the Council expected Redgate to work to the National Indicator (NI) 195 B+ standard. He also reiterated that Redgate would be required to take photographs of passageways before and after any cleansing to enable officers to remotely monitor standards and additional random spot checks would be undertaken by Council staff. He explained that citywide performance of passageway cleansing would be shared with the Executive Member for Vibrant Neighbourhoods and reported to the Environment, Climate Change and Neighbourhoods Scrutiny Committee annually.

The Executive Member for Vibrant Neighbourhoods supported the decision, emphasising the commitment to a cleaner, greener city and improvements in performance management.

Section 106 Agreements

The committee reviewed the annual Section 106 Legal Agreement (s106) activity for 2024/25, as detailed in the Annual S106 Monitoring Report. Section 106 agreements¹ are legally binding contracts between a local planning authority and developers, ensuring contributions towards local infrastructure and community benefits.

Key discussion points included:

• The proposed Planning and Infrastructure Bill 2025, which suggests viability be tested at the plan stage rather than at each application stage.
• The use of an additional £700,529 secured from the development at Swan House
• Monitoring of tree-planting conditions.
• Involvement of councillors in decision-making regarding s106 funds generated in their wards but spent elsewhere.
• The impact of increased land value on s106 contributions.
• Publishing records of negotiations with developers.
• Comparison of Manchester's s106 income and spend with other Core Cities.
• The need for affordable and social rent housing in the city centre.
• The breakdown of unspent s106 contributions by ward.
• Monitoring of enforcement.

The Executive Member for Housing and Development highlighted the importance of s106 funds for affordable housing, public spaces, and community infrastructure, noting that 92% of Manchester's social and affordable housing is delivered outside of the s106 process.

The Section Planning Manager clarified that the report did not explicitly detail on-site affordable housing secured through s106 funds, promising more detail in future reports.

The committee requested further information on different approaches to s106 income and spend in other Core Cities and asked officers to consider insourcing viability assessments, in consultation with the Executive Member for Housing and Development.

Review of Development Agreements

The committee considered a report on the council's framework for development agreements and overages related to new developments on council land. The Assistant Director of Development and Investment Estate stated that development agreements were a key mechanism in driving regeneration, unlocking investment and securing long-term outcomes for Manchester. He highlighted recent work undertaken to strengthen the approach to financial assurance, overage capture and contract oversight and that a previous review had identified inconsistencies in the approach to documentation and monitoring. He stated that a cross-departmental Task and Finish Group was established in 2024 to develop a more robust corporate framework and that records had now been centralised in the CPAD system. He advised that a new set of flexible but consistent financial principles had been developed for agreements and that transparency and audit rights had been improved. There was a clearer governance structure which was supported by internal training and enhanced cross-departmental working to ensure returns on public assets were optimised and confidence was maintained.

The Strategic Director (Growth and Development) clarified that the changes aimed to add rigour to the existing process, ensuring the council acts on triggers where relevant. The Executive Member for Housing and Development emphasised the importance of partnership working and ensuring land disposal meets the council's wider objectives.

New Finance and HR System

The committee received an update on the replacement of the council's finance and HR system. The Executive Member for Finance and Resources stated that the programme to replace the HR and finance system began in 2022 and that the technology platform supporting the current system was outdated, with support due to be withdrawn from 2027. He stated that this had been extended to 2030 but would cost the Council a significant amount. He highlighted that the programme remained within the approved budget and there was no slippage in the timeline, with the HR element due to be implemented later this year and the Finance element in spring 2026.

The Director of ICT explained that the council had reviewed other local authorities' ERP² implementations to learn lessons and ensure the project's governance was on track. The new system would be cloud-hosted for resilience, and business continuity processes were being reviewed.

The City Treasurer noted a £2 million annual budget for the system, with the new contract costing £400,000 more per year due to off-site hosting for enhanced security. He also stated that there were different tools available to train staff depending on how they would use the system, with staff in HR and finance being superusers. He also provided assurance that one-to-one training would be available for those who required it. He recognised that people learn differently and stated that there would be suite of packages available to support users.

Preparations for End of Major Contracts

The committee considered a report from the City Treasurer detailing preparations for the end of major contracts, particularly within the context of the council's Insourcing First motion. Recent insourcing examples included Commercial Property services and the Housing Management service. The committee agreed to discuss this further in a Part B report, which would be confidential.

Update from the Revenues and Benefits Unit

The committee received an update from the Revenues and Benefits Unit, covering benefits administration, the Household Support Fund scheme, council tax collection, and business rates collection.

The report highlighted the impact of the cost-of-living crisis on residents' ability to pay council tax, with the in-year collection rate at 88.38%, lower than the pre-covid rate of 92.8%. The report also detailed the unit's approach to collecting money owed, supporting vulnerable households, and providing business support through rates relief and grants.

The report provided data for the full 2024/25 financial year and available data to show activity between 1 April and 31 July of the 2025/26 financial year.

Anti-Poverty Budget Update

The committee discussed the council's anti-poverty measures, including core programs, additional funding since 2021, and longer-term strategies through Making Manchester Fairer. The report identified current budgets and support the Council operates in delivering its Anti-Poverty measures and considers options for future anti-poverty provision. The report covers the Council's core anti-poverty measures; additional funding provided since 2021 to address the cost-of-living crisis; and longer-term activity through Making Manchester Fairer.

Revenue Budget Process 2026/27

The committee received an update on the Medium-Term Financial Plan and the planned approach to the 2026/27 budget process. The report also included a high-level overview of the government's Fair Funding Review.

Manchester Energy Network Business Performance Update

The committee received an update on the business performance of the Manchester Energy Network, covering financial performance, decarbonisation, resourcing, and other relevant matters. Due to the commercially confidential nature of the business performance update, this was required to be treated as a Part B item, from which the press and public were excluded.

Overview Report

The committee received a report from the Governance and Scrutiny Support Unit, providing responses to previous recommendations, details of key decisions within the committee's remit, and updates on previously requested information.