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Greater Manchester Combined Authority Single Entity Accounts

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Greater Manchester Combined Authority Single Entity Accounts Annual Statement of Accounts Year ended 31 March 2020 With Audit Opinion Annual Statement of Accounts 2019/20 Contents Page Introductory and Governance Statements • Narrative Report by the Treasurer 3 • Statement of Responsibilities for the Annual Statement of Accounts 34 Greater Manchester Combined Authority Single Entity Core Financial Statements • Comprehensive Income and Expenditure Statement 37 • Movement in Reserves Statement 38 • Balance Sheet 39 • Cash Flow Statement 40 • Notes to the Core Single Entity Financial Statements 42 • Firefighters’ Pension Fund 137 Greater Manchester Combined Authority Group Accounts • Introduction to the Group Accounts 140 • Group Comprehensive Income and Expenditure Statement 144 • Group Movement in Reserves Statement 145 • Group Balance Sheet 146 • Group Cash Flow Statement 147 • Notes to the Group Financial Statements 149 • Police Pension Fund 191 Glossary of Financial Terms 193 Auditor’s Report 202 2 Greater Manchester Combined Authority Statement of Accounts 2019/20 Narrative Report by the Authority Treasurer Welcome to the Greater Manchester Combined Authority’s (the Authority) Annual Statement of Accounts for 2019/20. The statements have been prepared in accordance with the requirements of the Accounting Code of Practice issued by the Chartered Institute of Public Finance and Accountancy (CIPFA). This narrative report aims to provide information so that members of the public, Councillors, partners, stakeholders and other interested parties are able to have: • A full and understandable explanation of the overarching financial position of the Authority and the financial performance for the year 2019/20; • Confidence that the public money with which the Authority has been entrusted has been used and accounted for in an appropriate manner; • Assurance that the financial position of the Authority is sound and secure. This narrative report provides information about the Authority, including the key issues affecting the Authority and its accounts. It also provides a summary of the financial position at 31 March 2020 and is structured as below: • How the Authority Performed in 2019/20 • Devolution and Impact in 2019/20 • The Authority’s Group of Companies • Revenue Budget and Financial Performance 2019/20 • Capital Programme and Financing 2019/20 • Treasury Management Performance in 2019/20 • Forward Look – Financial Landscape • Core Financial Statements How the Authority Performed in 2019/20 Greater Manchester is one of the UK’s most successful city regions and wants to become one of the best in the world. The Authority is made up of the ten Greater Manchester Council Leaders and the Mayor who work with other local services, businesses, communities and other partners to improve the city-region. The ten Greater Manchester councils (Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford and Wigan) have worked together voluntarily for many years on issues that affect everyone in the region, like transport, regeneration, and attracting investment. Greater Manchester elected its first Mayor, Andy Burnham, in 2017 and together a blueprint for the future of the city-region was created – Our People Our Place, the Greater Manchester Strategy (the GM Strategy). The GM Strategy was approved by 3 Greater Manchester Combined Authority Statement of Accounts 2019/20 the Local Enterprise Partnership and the GM Centre for Voluntary Organisation as well as the Authority and its partners. In this way, it brings together the public, private and voluntary and community sectors in delivering a bold new vision to make Greater Manchester one of the best places in the world to grow up, get on and grow old. The GM Strategy sets a comprehensive plan to create a more productive and inclusive city region and addresses education and skills, health, wellbeing, environment, work and economic growth simultaneously to make a real difference to the lives of those living and working in GM. It is focused on the two themes of people and place and is structured around 10 priorities based on a ‘life journey’ approach. In April 2018, the Authority agreed a two year Implementation Plan for the GM Strategy with the inclusion of ambitions to be achieved by 2020. Alongside the Implementation Plan, the GM Strategy Performance Dashboard has been developed to track progress against key outcomes and indicators. Good progress has been made across the whole range of priorities (with further detail provided below) demonstrating the benefits of collaboration and how devolution is continuing to make a real difference to the lives of the people of Greater Manchester, though there remains further challenges and opportunities going forward. The COVID-19 Pandemic has had a significant impact on Greater Manchester. At meetings in June and July 2020 the GMCA considered the development of a one year Greater Manchester Living with COVID-19 Plan and financial implications for GMCA and TfGM. The narrative below includes context on the response by the Authority to the pandemic and the short to medium term impact for GM priorities and financial position. The Greater Manchester Local Industrial Strategy In June 2019 Greater Manchester published its ambitious Local Industrial Strategy, designed to deliver an economy fit for the future, with prosperous communities across the city-region and radically increased productivity and earning power. This Local Industrial Strategy represents a strong partnership between local leaders and government, setting out an ambitious plan to achieve the aspirations of the national Industrial Strategy and to continue to contribute to Greater Manchester’s prosperity. The strategy is based on the robust evidence provided by the 2019 Independent Prosperity Review, and the 2016 Science and Innovation Audit. It has been developed from the ground up with local and national stakeholders, including business and social enterprises, trade unions, universities and colleges, and community and voluntary organisations. The Greater Manchester Local Industrial Strategy will not work in isolation. It complements other national and local strategies including the national Industrial Strategy and the Greater Manchester Strategy ‘Our People, Our Place’. Our People, Our Place sets a clear objective to make Greater Manchester one of the best places in the world to grow up, get on in life and grow old. To achieve this ambition, it identifies actions around five foundations of productivity: Ideas, People, Infrastructure, Business Environment and Places, which are the essential attributes of every successful economy. It also identifies opportunities grouped under four Grand Challenges: Artificial Intelligence and Data, the Ageing Society, Future of Mobility and Clean Growth, where the UK has the potential to be at the forefront of industries of the future. The Greater Manchester Local Industrial Strategy takes an approach that builds on local strengths and develops a city region 4 Greater Manchester Combined Authority Statement of Accounts 2019/20 specific approach to tackling the foundations of productivity and capitalising on the Grand Challenges. Growing the Economy Over the past year, the Authority and its partners worked to be ever more connected, productive, innovative and creative, known for the excellent quality of life enjoyed by residents who are able to contribute to and benefit from the prosperity that economic growth brings. Inclusivity and opportunities for all being at the heart of Greater Manchester’s strategic approach helped drive up productivity and economic growth across the region. The Greater Manchester Good Employment Charter, developed with employers, trade unions, professional bodies and others, is raising employment standards and tackling economic inequality through spreading more secure work and higher pay. It has now engaged over 200 employers with more than 200,000 employees in the city region. The GM Investment Strategy continued to support regeneration and job creation in the Greater Manchester area through targeted investment that reflects the strengths and opportunities in the local economy. The GM Investment Strategy was based on sustainably generating returns that can be recycled and reinvested – as existing loans are repaid, they can be reinvested in new projects. The GM Investment Funds are used as a lever to deliver the Investment Strategy and focus on our strategic priorities in business, housing and commercial property. At the end of 2019/20, the GM Investment Funds included over £635m of funds under direct and indirect management. Projects to the value of £862m have been approved to date across the funds. The main elements of the Funds are: 1. The Greater Manchester Housing Investment Loans Fund (HIF): HIF aims to unlock the delivery of at least 10,000 homes over the 10-year life of the fund providing the high quality housing offer needed to support GM’s economic growth. Over £432m has been committed so far to support the delivery of almost 6,000 new homes. In 2018/19 HIF novated from Manchester City Council to the Authority. 2019/20 was the final year under which GMCA was able to draw down funds from MHCLG, with a net total of £181m drawn down to the end of the year. As existing investments made by the Fund are re-paid the monies are available for reinvestment by the Fund. The COVID-19 pandemic and lockdown has caused delays to the completion of developments, and the rate at which properties are sold or let will likely be slower than originally anticipated. As such, extended
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