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

Transport and Major Work Manager

Slough Borough Council
£54,556 to £60,085 per year Inclusive of Local Weighting Allowance of £1096
Drive the future of transport and infrastructure in Slough Slough, Berkshire
Recuriter: Slough Borough Council

Restorative Justice Practitioner

Essex County Council
£26284.00 - £33256.00 per annum + pension
Restorative Justice PractitionerPermanent, Full Time£26,284 up to £33,256 per annumLocation
Recuriter: Essex County Council

Events Administrator - Harlow District Council

Essex County Council
Up to £14.8800 per hour
Events Administrator - Harlow District CouncilHarlow District CouncilTemporary, Full Time£14.88 ph PAYELocation
Recuriter: Essex County Council

Adults Social Worker - South Essex (Various Teams)

Essex County Council
£38487 - £51834 per annum
We're an adult social care service that wants to see citizens of Essex have as much choice and control over the way they live their lives as possible England, Essex, Basildon
Recuriter: Essex County Council

Autism Training Coodinator

Essex County Council
£48121.0000 - £56612.0000 per annum
Autism Training CoodinatorFixed Term, Full Time£48,121 to £56,612 Per Annum Location
Recuriter: Essex County Council
Linkedin Banner