Flintshire Council has warned it’s in danger of being unable to set a balanced budget next year after its predicted financial shortfall rose above £16m.
Despite being legally bound to do so, senior officials have warned balancing the books will be difficult unless extra money announced in the UK Government’s spending review is passed on to local authorities by ministers in Cardiff.
The council is among the lowest funded in Wales and at the start of the year its forecast deficit for 2020/21 stood at £9.5m, but was later revised up to £13.3m.
That figure has now risen to £16.2m based on an increase in contributions towards teachers’ pay and pensions, as well as other cost pressures.
The council’s chief executive Colin Everett has now called for the Welsh Government to provide extra funding or face the risk of it failing to meet statutory requirements.
In a report set to go before the authority’s ruling Labour administration next week, he said: “Over the summer, the forecast has been revised to take into account the latest intelligence on pay and other pressures which has led to an increase in the budget gap to £16.2m for 2020/21, which is a further increase of £2.9m.
“The report provides an update on the national position as it stands at the moment together with the councils’ high-level strategy to meet the forecast gap and highlights the risks associated with this.
“It is essential that adequate funding is provided by Welsh Government from the additional funding announced in the UK spending review.
“In the absence of this additional funding the council will be at significant risk of not being able to set a safe and legal balanced budget.”
Last year, the council launched a cross-party campaign for extra money under the banner of “#BackTheBudget”.
It saw a large group of councillors from across the political divide travel on a bus to the Senedd in Cardiff Bay to lobby AMs.
While some additional funding was made forthcoming for local government, the authority said it did not meet the full amount it had requested.
It led to a council tax increase of 8.75 per cent in Flintshire, which was met with anger from people living in the county.
This year it is aiming to cap any rise for taxpayers at 5 per cent, but Mr Everett said it would only be achievable with an improved settlement and an estimated 6.5 per cent rise has been included in its current calculations.
He added: “The level of council tax increase will be modelled on a range of different scenarios as part of ongoing strategy with consideration of Welsh Government assumptions once known.
“If council tax were to increase in line with current assumptions of 6.5 per cent, that would yield an additional £5.4m net of the impact on the council tax reduction scheme.
“The council aim is to keep any increase in council tax to a maximum of 5 per cent which would yield an additional £4.3m, however this would need to be subject to a much-improved settlement from Welsh Government.
“The council is continuing to review its current fees and charges with the aim to reach full cost recovery for as many services as possible.”
The report will be considered by the council’s cabinet at a meeting being held at County Hall in Mold on Tuesday, October 22.
By Liam Randall – Local Democracy Reporter (more here).