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

Highways Supervisor

Amey
£Competitive
We’re excited to offer a fantastic opportunity for a permanent Highways Supervisor to join our NMC North East (NMC NE) team in Dundee Dundee, Dundee City
Recuriter: Amey

Director of Public Health

Salford City Council
£109,483 to £122,620
This is a rare and career-defining opportunity to shape the future of public health Salford, Greater Manchester
Recuriter: Salford City Council

Deputy Chief Executive (Executive Director Corporate Services)

Salford City Council
Up to £158,276 p.a. (pay award pending)
Salford is a bold, ambitious and values-led city. Salford, Greater Manchester
Recuriter: Salford City Council

School Crossing Patrol Officer - Thomas Willingale School

Essex County Council
Up to £13.00 per hour
School Crossing Patrol Officer - Thomas Willingale SchoolPermanent, Term Time£13.00 per hourLocation
Recuriter: Essex County Council

Senior Practitioner - Leaving & Aftercare Team, Mid Essex

Essex County Council
£46574.0000 - £56027.0000 per annum
Senior Practitioner - Leaving & Aftercare Team, Mid EssexPermanent, Full Time£46,574 to £56,027 per annumLocation
Recuriter: Essex County Council
Linkedin Banner