By Mark Smulian | 10 October 2014
Key council services could disappear following further reductions in the sectors financial settlement from the Welsh Government, the country’s local government leaders have warned.
Public services minister Leighton Andrews announced on Wednesday there would be a 3.4% reduction in revenue support grant to £4.12bn for 2015/16.
He said this was because of ‘the large scale budget reductions being imposed by the UK Government’, which had seen the Welsh Government’s budget for 2015-16 fall by some 10% from its 2010/11 level.
Although the level of reduction for individual authorities will differ, Andrews also announced that a damping mechanism would limit the cut in grant in any council to 4.5%.
‘When local authorities draw up their budget plans for next year I expect them to look at all income streams, including council tax and income from fees and charges,’ he said.
‘In setting council tax levels, I urge them to balance the funding challenges they face with consideration of the financial burden facing households.’
The settlement provided £244m for the council tax reduction scheme and councils ‘must take account of the effect of the scheme in making decisions about their council tax levels’, he added.
Welsh Local Government Association leader Bob Wellington said: ‘Within the latest Welsh Government budget, local councils have once again been asked to shoulder a disproportionate share of the austerity burden, and it is time for politicians at all levels to be honest about what this actually means for the communities we serve.
‘The financial issues affecting local government will impact on us all. They will impact on the range and quality of the services we receive, the taxes and charges we pay and they will impact on the very fabric and resilience of communities in Wales.’
WLGA finance spokesperson Aaron Shotton, leader of Flintshire County Council, added that the current system for funding local councils was broken.
He called for the establishment an independent commission on local government finance – similar to that created by CIPFA and the Local Government Association in England – to examine the sustainability of council funding into the future.
The WLGA conceded that council services in Wales had been better protected against cuts than those in England but said there had still been substantial spending reductions since the recession began, including a 34% fall in economic development spending and 30% cut in regulatory services.
