City council faces £60m rise in cost of maintaining services

Kieran Molloy – Local democracy reporter

A city council has estimated it will face a £60.3m rise in the cost of maintaining services at their current level ahead of its 2027-28 budget.

Cardiff Council is expected to be partially filled by £15.3m of additional funding, which would leave a budget gap of £45m.

The figure is £1.2m higher than forecast in March and will continue to be reviewed as further information becomes available.

A budget gap is the difference between what a council expects to spend and the funding it expects to receive.

The £60.3m rise in costs is broken down between £22.4m for inflation (including the increasing cost of commissioned care, home-to-school transport, and education placements), £17.4m for workforce costs, £11.3m for increasing demands for services, and £9.2m for capital financing, existing commitments, and other financial pressures.

Cardiff is currently assuming a 2% increase in general Welsh Government funding for 2027-28, which is an increase of about £14.4m.

However no indicative funding allocation has been provided.

Council leader Chris Weaver said: “Like councils across the country Cardiff continues to face significant financial pressures. The cost of delivering services is increasing while demand in areas such as social care and additional learning needs remains exceptionally high .”

The long-time Welsh Labour member continued the council’s priorities would be to protect “the services residents rely on” and to support the “children, adults, and families” that need them most.

However the council does not “underestimate the scale of the challenge ahead”.

Cllr Weaver said: “These are initial forecasts and not a final budget. We will continue to make the case for a fair funding settlement for Cardiff while working across the council to identify savings, reduce costs, and deliver services as efficiently as possible.”

The council’s member for finance, Cllr Leonora Thomson, said: “The £45m gap is based on the information currently available but there remains considerable uncertainty around inflation, staff costs, demand for services and, crucially, the funding Cardiff will receive from Welsh Government.

“We will continue to prioritise efficiency savings and income generation alongside the council’s change programme.

“But the size of the gap means efficiencies alone are unlikely to be sufficient and some proposals affecting the way services are delivered may also need to be considered.”

The member for finance stressed no decisions have been made and any proposals will be subject to a consultation.

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