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

School Crossing Patrol Officer

Essex County Council
Up to £13.4600 per hour
School Crossing Patrol Officer Chelmsford, Essex Part-Time, Temporary 7.5 hours per week, term-time only Up to 6 Months £13.46 PAYE / £17.24 Umbrella England, Essex, Chelmsford
Recuriter: Essex County Council

Adults Social Worker - Mid Essex (Various Teams)

Essex County Council
£38487 - £51834 per annum + Flexible Working, Hybrid Working
Interviews will be held in person at County Hall on 8th June 2026.We're an adult social care service that wants to see citizens of Essex have as much England, Essex, Chelmsford
Recuriter: Essex County Council

Administrative Officer

Durham County Council
£26,403-£28,598 (pro rata)
Administrative Officer Permanent, Full Time, Term Time Only Required to start September 1st 2026   The Headteacher and Governors of this Outstanding M Seaham
Recuriter: Durham County Council

Assistant Psychologist

Durham County Council
Grade 8 - £32,597 - £36,363
This is a 2-year post within the Educational Psychology Service which is part of the SEND and Inclusion Service for Durham’s Children and Young People Spennymoor
Recuriter: Durham County Council

Structures Assistant Engineer

Durham County Council
£35,142 - £39,152
Highways Services re looking for a Structures Assistant Engineer to join their Highway Team.    WHAT IS INVOLVED? You will be responsible for providin Durham
Recuriter: Durham County Council
Linkedin Banner