Council forecasting ‘extremely bleak’ financial picture and difficult decisions on cuts

Nicholas Thomas Local Democracy Reporter

A council leader has accepted that people will say they are “paying more and getting less” if a council tax rise is approved.

Sean Morgan said the council had to make millions of pounds of savings because of cuts to funding from central government.

Residents will soon be able to have their say on the council’s draft budget proposals, including a 6.9% hike in council tax bills and a range of measures designed to save the council money.

“Extremely bleak”

These include charging more for home care and the use of sports pitches, cutting staff training budgets, closing down Coffi Vista in Caerphilly town and “mothballing” the Winding House in New Tredegar.

Eluned Stenner, the cabinet member for finance, told a meeting on Wednesday January 17 that the 2.3% rise in the Welsh Government’s settlement to Caerphilly Council equated to around £7.5 million.

This was “well below the level of funding required”, she added.

Cllr Stenner said that meant the council had to deploy “one-off temporary measures” to fill a funding gap, including using around £11m of its reserves.

She forecast an “extremely bleak” financial picture for the next two years, during which it would be “inevitable” the council would face difficult decisions around how to save money.

This was backed by Steve Harris, the council’s head of financial services, who said the council had “been able to use our reserves in the short-term – but that’s not sustainable in the long-term”.

Cllr Morgan, too, told colleagues “reserves don’t go on forever”.

“Difficult situation”

Financial pressures on local government extend beyond Caerphilly. The average rise in settlements to Welsh councils is 3.1%, a rate below UK inflation at the time of the announcement in December.

Jamie Pritchard, the council’s deputy leader, told cabinet colleagues people had “only got to look at the news to find out that local government across Wales… and Britain is in a very, very difficult situation”.

The issuing of Section 114 notices by several English upper-tier authorities – effectively declaring bankruptcy – was “something every council should be seeking to avoid at all costs”.

Cllr Pritchard said “real-terms cuts to budgets” had made the council’s job “extremely difficult”, and urged residents to “keep in mind the pressures on local government”.