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

Residential Assistant

Essex County Council
£25081.00 - £25395.00 per annum
Residential AssistantPermanent, Full Time£25,081 up to £25,395 per annumLocation
Recuriter: Essex County Council

Senior Planning Officer

Durham County Council
Grade 11 £39,513 to £43,693 Grade 12 £42,708 to £46,731 per annum (Pay Award Pending)
Durham County Council is looking for experienced and knowledgeable Senior Planning Officers to join our vibrant Development Management team. Our team Durham
Recuriter: Durham County Council

Head of Service – Social Care

Wrexham County Borough Council
G15 £63,148 - £67,058 per annum
There is an exciting opportunity within Children Social Care to join the senior management team Wrexham (Wrecsam)
Recuriter: Wrexham County Borough Council

Head of Service Social Work & Specialist Support

Blackburn with Darwen Borough Council
Grade M scp 60 £72,118 - scp 64 £77,293
There couldn’t be a more exciting time to join us. Blackburn, Lancashire
Recuriter: Blackburn with Darwen Borough Council

Cafe Assistant - Weald Country Park

Essex County Council
Up to £13.3000 per hour
Café Assistant (Weald Country Park)Contract
Recuriter: Essex County Council
Linkedin Banner