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Devolution and Reform in Greater Manchester

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GM as a net contributor to the national economy

A vision to move GM from being a cost centre to a net contributor to national public financesGM’s economy currently generates £17bn in taxes BUT requires £22 billion in public spending

Reductions in local public spending in investment and growthBut increasing spend for national sources welfare and health

7.8 8.3

7.2 5.9

4.8 5.1

3.2 3.2

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5.0

10.0

15.0

20.0

25.0

08/09 12/13

GM

exp

endi

ture

(£bn

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Benefits and tax credits Local authorities Health Other

16,000

17,000

18,000

19,000

20,000

21,000

22,000

2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21

£m

(2010 p

rices)

Tax income Public spend

£21.5bn

£21.2bn

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The GM devolution agreement

New powers received by the Combined Authority:• devolved responsibility for business support budgets, making it easier to join up

services to make sure that businesses are able to access the right support at the right time to help them grow and innovate

• the ability to work with Government to reshape and re-structure Further Education (FE) provision within Greater Manchester to ensure that the supply of skills in GM meets the needs of our businesses

• the power and resources to scale up our work on complex dependency pilot to help 50,000 people who have struggled to find work get into jobs

• GM to jointly commission (with the Department for Work and Pensions) the next phase of the Work Programme, giving us the influence to tailor services to best meet the needs of our residents

• working with GM Clinical Commissioning Groups to develop a business plan for the integration of health and social care across Greater Manchester, allowing us to use existing health and social care budgets to invest in the community based care needed to support change

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The GM devolution agreement

New powers received by a directly elected Mayor:• devolved responsibility for a joined up and multi-year transport budget, to be agreed

at the next Spending Review• responsibility for franchised bus services, including powers over fares, routes,

frequency and ticketing• the power to introduce integrated smart ticketing across all local modes of transport• the ability to shape local rail station policy and development across the Greater

Manchester area• powers over strategic planning, including the power to create a statutory spatial

framework for Greater Manchester. This will need to be approved by a unanimous vote of the Mayor’s Cabinet

• control of a new £300 million recyclable Housing Investment Fund• control of a reformed “earn back” deal, worth £900 million over 30 years• the role currently covered by the Police and Crime Commissioner

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Governance and Accountability

Mature, stable governance structures• Long history of voluntary collaboration, evolved from the bottom up ensuring ownership from

all districts

Leadership portfolios• Ensure ownership of GM’s strategic priorities and accountability for delivery

Unique private / public leadership of GM’s strategic agenda• LEP & Business Leadership Council have played a key role in the development of the growth and

reform agenda • GM Investment Board provides strategic leadership and oversight of the GM Investment

Strategy and funding streams

Continual evolution and innovation in governance• Will continue to evolve to support GM’s approach to devolution

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Evolving governance arrangements

• An appointed Mayor, as an 11th member of the CA, in place as soon as the necessary parliamentary procedures allow

• Legislation to create the role of a directly elected Mayor• First elections anticipated in 2017• Chair of the GMCA and Cabinet• 10 Leaders with portfolio responsibilities allocated by the Mayor

• Devolution of some new responsibilities is possible without legislation and will be passed to the GMCA immediately

• Others dependent on the implementation of the city region Mayoral model• On public service issues the GMCA members and the Mayor will each have one

vote• The directly elected Mayor required to consult the GMCA Cabinet on strategies

and spending plans – a two thirds majority can reject

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Supporting the Most Vulnerable

Work & Skills Devolution

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Our long term focus for work and skills is to develop a market of providers who collectively have expertise in dealing with particular GM cohorts in need of support

• Local businesses are able to grow and have access to, and importantly invest in, the skills they require from their workforce.

• GVA increases by driving productivity and attracting new employers to our region by ensuring we have the skills that employers need.

• Residents are supported to make the best choices about their employment and skills options.

• Worklessness is reduced by enabling GM residents to access the right ‘work and skills’ support at the right time and increasing investment in ‘preventative interventions’ to reduce individuals falling into long term worklessness.

• Value for money for taxpayers and local residents is increased:

– Better integrated and more responsive services, delivering improved outcomes for the investment being made

– We have to ensure that the limited and shrinking Adult Skills Budget is refocused on developing the Level 3+ technical skills that GM employers increasingly need to remain productive and competitive, rather than being spent on remediation.

Reform of the employment and skills landscape must align with the broader growth and reform objectives for GM

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Five programmes of work are underway to deliver the devolution reforms that have been agreed

The GM Agreement includes a range of reforms across the work and skills landscape, enabling GM to directly control or influence over £500m of funding. These are:

• The staged expansion of Working Well from Summer 2015. By the time it is fully rolled out, the programme will cover 50,000 individuals and have a £100m budget. This work will include a pilot supporting older workers with long-term health conditions back to work.

• Reshaping and restructuring FE (post 19 skills) provision worth £150m (including Apprenticeships) within GM and aligning to £170m of EFA spend.

• Government designing the Work Programme in a way that allows GM to be a joint commissioner. Work Programme contracts across GM are worth c£100m.

• Devolution of the AGE Grant to GM from April 2015.

Though not included in the GM Agreement, ensuring alignment of Skills Capital is fundamental in to the reshaping of the GM FE sector (future activity will be aligned the programme 2)

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Taken together, while only reflecting a proportion of the investments made in employment and skills within GM, these current devolved powers enable us to exert significant influence on the supply and demand dynamic. Through these reforms, GM will improve outcomes for residents, invest in innovation & prevention and create savings through better performance and improved use of resources

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Working Well expansion: On-track to begin a phased approach to expansion in 2015 1

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Current Working Well 2015-17 Post 2017

Up to two years of intensive dedicated key worker support for 5,000 ESA WPL

40-50:1 keyworker ratio

Housing support

Family support

Debt management £

Skills support

Training & work experience

Health support

Housing support

Family support

Debt management £

Skills support

Training & work experience

Health support

Bespoke and sequenced packages of support, drawing on a range of local services

Up to one year of in-work support

20% enter work

15% sustain work for a year

Supporting up to 50,000 with multiple inter-related barriers to employment, such as:

• Health issues• Homelessness• Addiction • Low confidence/motivation• Childcare problems• Low skills • Debt• Ex-offenders

PHASE 1 EXPANSION

Continuing to wrap provision around the existing employment and skills landscape: extended cohorts

PHASE 2 EXPANSION

Phase 2 expansion should form an element of the broader reform of the GM employment and skills landscape

CURRENT WORKING WELL PILOT

Supporting 1 claimant group for whom the WP has not delivered results

JCPGM Partners

WP

WW

Expanding the groups receiving (and referral routes to) support. Where possible, supporting people earlier

• Continuing to support up to and beyond 50,000 GM residents who would benefit from the WW approach

• Delivering support within a reformed landscape, taking account of changes to the skills and broader employment support framework

• Phase 2 expansion aligns with WP co-commissioning and the reconfiguration of the GM skills landscape

JCPGM Partners

GM WP

Skills for employment

Range of employment support offers

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Reshaping post 19 skills provision: Reform must support colleges and providers to deliver for learners at all levels, meeting the current and future employment needs of the region

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Developing a skills framework and payment options that better enables providers to support those furthest from the labour market

Integrated support for those furthest from the labour market

Supporting people at key transition points

Developing the high skills required in GM

A GM skills strategy aligned with our growth and reform ambition

Ensuring GM residents have access to high quality information, advice and guidance, supporting them in making decisions about their future

Incentivising the higher level skills provision that the economy needs, understanding how employer demand for skills links with GM Strategy

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Reshaping post 19 skills provision: A range of activity is underway to support GM in delivering a better integrated responsive skills system

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A range of activity is underway to support GM in delivering a better integrated responsive skills system:

• Mapping timelines for implementation, taking into account funding allocation requirements, legislative implications of reform and anticipated changes to funding levels

• Analysing current use and impact achieved by Adult Skills Budget (analysis of current spend, and work with providers to shape a reformed data collection framework)

• Exploring options for reform, including activity that could be undertaken and outcomes that GM is looking to achieve

• Developing approach to incentivising integrated employment and skills provision

• Developing an employer engagement function, ensuring employers have a role in shaping information, advice and guidance services, and delivering work experience opportunities

• Aligning skills reform with GM growth needs, delivering a skills landscape responsive to and aligned with the GM Spatial Framework and employment sites

• Using best evidence of employer demand, commissioning a GM Skills Capital Strategy, based around the priorities of a reformed FE system, enabling GM to implement reform as swiftly as possible

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Work Programme co-commissioning: We have been clear that our approach to co-commissioning should align with the broader employment and skills reforms

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People with multiple complex challenges

People with health barriers to employment

People closer to the labour market

Young people

Supporting people to progress

Other

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GM will want to see a system that is more responsive to the presenting needs of individual clients (rather than focusing on their claimant group), aligned with the expansion of Working Well

A focus on assessment will be important in identifying those who need more intensive, integrated support

By 2017, reform to the FE landscape will include ensuring there is adequate provision for those furthest from the labour market

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Work Programme co-commissioning: Initial discussions have set out key issues GM will want to factor into a co-designed framework

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• Drawing on evidence of what works: Aligned to the expansion of Working Well and broader GM reforms

• Appropriate geography for provision: GM contract package area

• Consideration of different investment models: Enabling GM and Government to leverage in investment from a range of partners

• Supporting the integration of local services: Building on the integrated infrastructure supporting existing reform programmes

• A central role in contract and performance management: Supporting our capacity to deliver an integrated delivery framework

• A mixed delivery model/different pathways of support: Enabling people to access the right support at the right time

• Payment models that incentivise sustainable employment: Supporting people to enter and progress in employment that offers sustainable opportunities

• A ‘grey box’ approach to programme design: Supporting innovation but ensuring services align with the wider GM landscape

• Integrated employer engagement: Ensuring GM services reflect the needs of GM employers

• Engagement with skills providers: Incentivising skills providers to support hardest to help groups

• A high quality approach to assessment: Understanding the barriers people face to employment, enabling the targeting of intensive support to those who need it