The council and the cuts

Article published: Friday, December 10th 2010

With Manchester City Council staring devastating spending cuts in the face, what did our councillors think about the impact on the city? MULE popped down to the Town Hall to find out…

Councillors, senior officials, business executives and voluntary sector heads gathered for the full council meeting on Wednesday 8 December.  There to discuss the impact of the comprehensive spending review on the city, the various local bigwigs were greeted outside by protestors fighting to save South Manchester Law Centre and Greater Manchester Immigration Aid Unit.  Forty supporters also came to sit in the public gallery to continue the pressure for their campaign to protect legal aid.

The most significant item was the report on the comprehensive spending review, and a number of high ranking public officials presented on the matter. First up was Council Chief Executive Howard Bernstein, who unleashed a devastating barrage of statistics. A 28 per cent reduction in government spending over the next year will be front loaded, meaning the next two years will see the harshest cuts. There will be ‘significant job losses’ – 20,000 public sector jobs gone across Greater Manchester according to the Office for Budget Responsibility, 11,000 in Manchester itself.  26,000 private sector jobs will also go as a result, adding to the 46,000 jobs lost in Greater Manchester already due to the recession, 6,000 of them in Manchester.

Council forecasts suggest there is potential for the creation of 75,000 private sector jobs in Greater Manchester by 2015, which could go some way to balancing out the losses. There are two problems, however. First, this relies on the assumption that the economy will bounce back rather than stagnate or go into a ‘double dip’.  Second, most unemployed residents won’t have the skills to access these jobs.  50 per cent of the predicted vacancies require level 3 qualifications while only one third of unemployed people have level 3 qualifications and a further third have no qualifications at all. As Bernstein pointed out, the single biggest challenge for Manchester’s economy is skills, an area in which the city has been ‘moving backward’ rather than forward, which prompted the first cries of ‘EMA’ and ‘tuition fees’ from the Labour councillors.

Next he moved onto cuts and let slip, to the delight of Liberal Democrats, that the council had already been expecting and planning for cuts of the current scale under the previous government. The figures are grim: £62 million will be cut from Manchester’s welfare budget by 2014, assuming there is no drop in unemployment. When taking into account the June ‘emergency budget’ created by the Coalition, it’s more like £180 million.

The hope for growth, according to Bernstein, will lie with the Regional Growth Fund and the newly formed Local Enterprise Partnership (even though there will be less funding than under the soon-to-be-disbanded North West Regional Development Agency).  Manchester is going to have to be ‘smarter than ever’ in fighting for available funding on the market.  Following on from Bernstein’s presentation was the Manchester City Council Treasurer, who confirmed that next year’s budget will be the tightest.

Laura Roberts, Chief Executive of NHS Manchester, then took the floor.  She pointed out that although the NHS budget has been ring-fenced the NHS is still being asked to make £20 billion of efficiency savings to free up cash to invest in frontline services, meaning Greater Manchester NHS will have to find £200 million. Life expectancy in Manchester is currently the second lowest in England for men, fourth for women.

Andy Brown of the Citizens Advice Bureau heaped on yet more miserable news, explaining how the welfare reforms will affect Manchester residents.  He was convinced the changes will cause ‘real hardship’ for ‘significant numbers of people’, disproportionately affecting the poor.

Apparently not noticing the apocalyptic mood of the room Clive Memmott, of Greater Manchester Chamber of Commerce (GMCC), bounded onto stage to offer a ‘slightly different perspective.’ Businesses, he explained, think things are ‘not as bad as expected’.  Manchester is in a ‘fantastic position’ and businesses got the infrastructure upgrades they asked for. The first of increasingly loud Labour hecklers began to voice their displeasure at this. In chirpy tones, he asserted how the deficit simply had to be reduced and was ‘confident’ that businesses will create employment. The really good news, he said, are the ‘huge opportunities’ in public sector reforms.  In a global market, ‘the Manchester brand is strong’, and government should offer support to high tech engineering industries and finance.

Heckles increased and Memmott got the tar and feathers treatment from councillors in the question and answer session. He was not, apparently, merely the representative of GMCC but of global finance capital and neoliberal political ideology in general.  Julie Reid practically screamed at him to explain where the new skilled jobs are going to come from when the education budget is being cut. Pat Karney demanded to know whether ‘your friends’ the bankers took any responsibility for the recession. Curiously, Memmott replied that it’s not really the bankers’ fault since most of the decisions are being made by computers anyway. Brian O’Neil, scarcely concealing his aggression, asked ‘how rosy is your outlook over the next four years? Can you give us guarantees that businesses will expand? And that the people who have lost their homes will get their homes back?’ Mary Murphy labelled the social housing reforms ‘a disaster.’ A Lib Dem member attempting to ask a question about the skills problems in Manchester could barely get his question across through the Labour calls of ‘EMA’ and ‘tuition fees’.

The two party leaders Richard Leese and Simon Ashley then traded verbal blows across the floor, debating global macroeconomics and trying to attribute blame for the crisis. It was certainly more interesting than the usual council fare. Leese closed by saying to Ashley, ‘People in Manchester will get poorer as a result of what you’re doing.’

The political landscape in the city council has changed markedly over the last 6 months. Suddenly, after all the last decade of business-friendly New Labour the Labour councillors, like their superiors in Westminster, have turned into firebrand socialists. Conveniently the Lib Dems, as representatives of government, can now be blamed for all the problems faced by the council.  Using the Coalition policies as a shield for any form of criticism of local government failures, as South Manchester Law Centre Campaigners discovered later on in the meeting, is something campaigners will have to become wise to.  And lest we forget, the pro-business deregulated approach to running the economy was swallowed hook line and sinker by Labour. With such fickle friends it’s understandable if poor old Memmott looked so bewildered.

The real problem however, is that rather than seriously discussing and exploring differing political and economic responses to the cuts both parties seem resigned to their inevitability, and are simply trying to shift the blame onto one another while it all goes ahead.

Andy Bowman

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More: Council, Cuts, Education, Features, Local economy, Unions and workplace, Welfare

Comments

1. “‘huge opportunities’ in public sector reforms” according to the Chamber of Commerce muppet – in other words £££££s in private consultancy firms telling government how to ‘rationalise’ services and run them more ‘efficienctly’, while a whole new layer of procurement and tendering law will mean une grosse tranche of the privatisation gateaux for corporate law firms and accountants. Is it any wonder he is rubbing his hands and salivating so eagerly?

   Comment by mick on December 10, 2010 at 6:45 pm

2. “As Bernstein pointed out, the single biggest challenge for Manchester’s economy is skills, an area in which the city has been ‘moving backward’ rather than forward”

   The Manchester College is provided with taxpayers’ money to help ensure that residents have the skills required by both themselves and businesses. What is their response to this challenge?

   Comment by Penguin on December 14, 2010 at 11:42 am

3. The scope for cuts at the council and other public sector employers is immense and the impact on services should be zero.

   In recent years the public sector workforce has expanded enormously with no corresponding improvement in services to the taxpaying public. We should remove most of these people from the payroll and cease to use the public services as a way to provide amenable employment for otherwise unemployable people.

   Comment by simon on December 14, 2010 at 2:00 pm

4. The CBI championing the cuts – there’s a suprise.

   so if they are unemployable
   what do you think they should do simon? sit on the dole all day – didn’t you have a rant about that before complaining there were to many people on the social?

   Comment by Dave on December 14, 2010 at 7:36 pm

5. […] from the public sector and third sector organisations expressed desperation over the likely consequences of the cuts at Manchester City Council’s executive meeting last […]

   Pingback by Manchester City Council facing 21 per cent reduction in government funding  —   MULE on December 14, 2010 at 8:59 pm

6. Simon – have you ever actually spoken to somebody who works in the Council housing department? The strain they are under is already immense with a waiting list of 23,000 (at last count). Manchester City Council have put a freeze on recruitment and with predicted natural leavers of around 500 a year, this means that the workforce of 11,000 will be cut by almost a fifth within four years (if the freeze remains). Meanwhile there will be an increased demand for essential services such as housing, social services and adult care as the job thefts start to set in. Even a moron should be able to understand that this will mean less people doing more work with reduced resources – in areas which already suffer from massive strain and inadequate funding. You should just be praying that your job is not among the thousands to be stolen; discriminatory changes to the Council’s policy on priority for rehousing will see unemployed people pushed to the bottom of the list.

   Comment by mick on December 15, 2010 at 2:45 am

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