Laura Sharman 19 April 2021

Welsh councils face £178m funding gap next year

Welsh councils face £178m funding gap next year image

Welsh local authorities will face a funding gap of £178m next year due to post-pandemic pressures, a new report has found.

Analysis by Cardiff University’s Wales Governance Centre warns this could rise to £607m next year if the Welsh Government decides to redirect budget resources to fund the projected legacy costs of COVID-19 on the NHS.

The report finds social services will account for 55% of all local authority spending pressures by 2025/26.

Cian Siôn, a researcher on the Wales Fiscal Analysis project, said: 'Even though the block grant is set to grow in real terms over the next five years, growing demand for services, including social care, and significant post-pandemic pressures combine to create a challenging outlook for the Welsh and local authority budgets.

'This challenge kicks in immediately with a substantial funding gap next year, based on current UK Government spending plans.'

The report also reveals that council tax now accounts for 5.4% of the total tax take in Wales, compared to 4.3% in England.

Mr Siôn added: ‘Our analysis suggests that above-inflation increases to council tax here to stay. In our model, we assume a 4.5% annual increase to council tax bills from 2022−23 to 2025−26, and even this is not sufficient to meet funding pressures in full.

’This strengthens the case for revisiting the way the local taxation system operates in Wales. A policy which pivots around inflation-busting council tax increases every year is an unsustainable way of funding local authorities in the long-term.’

SIGN UP
For your free daily news bulletin
Highways jobs

Café Assistant - Harlow Library & ACL Centre

Essex County Council
Up to £25959.0000 per annum
Café Assistant - Harlow Library & ACL CentrePermanent, Part TimeUp to £25,959 per annum (full time equivalent)Location
Recuriter: Essex County Council

Lead Officer - Housing ICT (CX Asset Management) - EFDC

Essex County Council
£500.0000 - £650.0000 per day
Lead Officer - Housing ICT (CX Asset Management) - Epping Forest District CouncilRemote Worker £500-£650 per day Umbrella, dependant on experiencePart England, Essex, Epping
Recuriter: Essex County Council

Lead Officer - Housing ICT (Cx Housing) - EFDC

Essex County Council
£500.0000 - £650.0000 per day
Lead Officer - Housing ICT (Cx Housing)- Epping Forest District Council Remote Worker £500-£650 per day Umbrella, dependant on experience Part-Time,3 England, Essex, Epping
Recuriter: Essex County Council

Part Time Vocational Trainer - Health and Social Care

Essex County Council
£38466.00 - £45254.00 per annum + Pro Rata
Part Time Vocational Trainer - Health and Social Care - South EssexPermanent, Part Time£29,468 to £34,668 Per Annum (full time equivalent) Location
Recuriter: Essex County Council

Procurement Support Officer

Essex County Council
£25959.00 - £28621.00 per annum + + 26 Days Leave & Local Gov Pension
Procurement Support OfficerPermanent, Full Time£25,959 to £28,621 Per AnnumLocation
Recuriter: Essex County Council
Linkedin Banner