Councils to withdraw from NHS agreement

Twm Owen, Local Democracy Reporter

A long-running agreement allowing the NHS and local councils to pool their health and social care budgets may soon come to an end.

The arrangement between Aneurin Bevan University Health Board and the five local authorities across Gwent has enabled the organisations to combine funding to support people living with frailty, including older residents who require care at home.

The partnership was first established in 2011 between the health board and Blaenau Gwent, Caerphilly and Torfaen councils, along with Newport and Monmouthshire, after the six bodies jointly secured a loan from the Welsh Government to improve health and social care services in the region.

Known as an “invest to save” project – where authorities make a spending commitment with the intention it will deliver savings over the longer term – the original “Section 33” agreement came to an end in 2015 and was replaced with the current arrangement in 2016.

But the councils say it is now out of date and have also raised concerns it has committed them to costs they don’t have direct control over. A report prepared by Torfaen council, also said there is “significant variation” in funding per person across Gwent and described subsidy from the health board as “uneven”.

The overall budget increased to £19.2m in 2025/26 with a forecast overspend of £106,000 in the current financial year staff pay awards citing as behind increased costs. Any historic underspends were,  the report said, usually a result of vacancies rather than “strategic planning”. Torfaen’s contribution this year was £897,813 which was an increase of just over £70,000 on the amount it paid in 2024/25.

As a result the councils have suggested the agreement is brought to an end in March 2027 and replaced with local pacts between the councils and health board. A 12 month notice period is required while the original loan has already been repaid.

New agreement

Torfaen council, which operates a federated model with Blaenau Gwent, intends to reach a new agreement with the health board to cover both areas which it says will “ensure that local health and community services for older people, continue to meet local identified needs”.

Torfaen council’s Labour cabinet must approve a decision to withdraw from the agreement and is being recommended to do so when it meets, at the Civic Centre in Pontypool at 2pm on Wednesday, March 18. Rules in other councils may allow the decision to be made by the social services director without the approval of the political leadership.

A report by Torfaen’s social services director, Jason O’Brien, said the council has been concerned by challenges it has faced in setting its own budgets and how the joint service has operated across Gwent and the “equity” of contributions from the different partners.