"The youth policy still has a role to play," he stressed.
"It is important for any successful team to have a group of players who have an empathy for the club. We have that with the guys who have come through the academy.
"But we are not just going to fill the squad as a token gesture to the work the academy does. The quality of players has to be sufficient to play in the Premier League. That is what their work is judged on."
While the most obvious example of the extra finance on offer was City smashing the British transfer record to sign Robinho from Real Madrid last week, Hughes has some good news for academy boss Jim Cassell and his dedicated team.
For he also feels the City academy can benefit from greater resources to improve the standard of player they are producing.
"The work within the academy will continue," he said. "What we have now are the means to enhance that operation. The academy has been extremely successful in recent years. With extra funds it can produce even better players."