Local government leaders in Wales have welcomed the latest figures put forward by the Cardiff administration for next year's budgets – but warned there could still be further cuts to services or rises in council tax.

Leader of the Welsh Local Government Association, Debbie Wilcox, said the 'funding floor' had been raised from -1% to -0.5% and an extra £13m would provide more for core services including education and social care.

She said the financial package signalled 'significant progress' and demonstrated a 'concerted effort to offset the impact of austerity.

But she added: 'Unfortunately, despite Westminster rhetoric, this failed philosophy is far from approaching its end game.

'Therefore, this does not mean the avoidance of cuts or rises to council tax since funding increases do not meet the pressures and costs of key services in relation to pay, inflation or demographics.

'Despite this welcome announcement, there is no doubt that this remains a particularly challenging financial settlement after 8 years of austerity.

'In particular, schools and teachers’ pay pressures remain and a huge pension cost remains unresolved. Welsh Government and WLGA are writing jointly to Westminster to press for this to be fully funded by the Treasury.'