Posted: Mon 13th Dec 2021

Flintshire Council budget gap grows to predicted £20.7m as leaders warn of ‘damaging cuts’

News and Info from Deeside, Flintshire, North Wales
This article is old - Published: Monday, Dec 13th, 2021

The estimated budget gap faced by Flintshire Council has grown to almost £20.7m as political leaders have warned it could cause “damaging cuts”.

The local authority predicted in July it would need £16.75m to balance its books for the next financial year.

However, a hike in National Insurance contributions and a higher-than-expected uplift in the levy charged by North Wales Fire and Rescue Service has caused the sum to rise.

A senior finance official has warned the black hole could increase even further, depending on the cost of service pressures such as “out-of-county” children’s care placements.

Other authorities in north Wales are said to be facing similar financial problems and all six council leaders in the region have now written to the Welsh Government calling for extra funding.

In a joint letter, which includes the signature of Flintshire’s Labour leader Ian Roberts, they said: “As a region, the six councils in North Wales have continued to work collectively to enhance the evidential case for the level of funding required to deliver balanced budgets that maintain service levels next financial year.

“When we wrote to you in September, we outlined that our regional analysis showed an annual uplift in AEF (aggregate external finance) of six per cent was required across the six councils.

“We have recently updated our position and can confirm that to avoid damaging cuts to local services, the minimum requirement is now an un-hypothecated increase of seven per cent but with further risks to be factored into the final position.

“These include continuing pressures in adult and child social care provision, including higher than planned fee increases to care providers, significant pay and energy price inflation and a fire and rescue levy likely to increase substantially above forecast levels.”

The position was raised by Flintshire’s corporate finance manager at a meeting held last week.

Gary Ferguson told councillors bridging the gap would be a “big ask” with savings of just £1.25m identified so far.

The authority has expressed its desire to cap any increase in council tax at five per cent after coming under fire for large hikes in previous years.

But even an uplift at the top end of the limit would only generate around a quarter of the amount required.

Speaking on Thursday (December 9, 2021), he told members of the council’s corporate resources scrutiny committee: “Despite the significant increase in additional budget requirements, there are still some remaining risks that potentially could increase that further.

“For example, with out of county placements, we need to be mindful that we’ve got that very much at the minimal level and it’s less than we’re incurring in-year.

“We need to keep a close eye on that over the coming weeks prior to budget setting.”

Councils are also calling for the Welsh Government to continue to provide money to support frontline services via its Covid-19 hardship fund.

In their letter, the six members of the North Wales Regional Leadership Board added: “We believe the withdrawal of the hardship funding for those services currently supported will have a devastating ‘cliff-edge’ impact on communities as the need for the services supported through the hardship fund will not end on 31st March 2022.

“We would therefore request that the hardship fund continues next year or is added, transparently, as an additional pressure, to the AEF settlement to local government.”

Ministers are expected to announce the provisional settlement for local authorities in Wales next week.

The budget position will be discussed further at a meeting of Flintshire cabinet members tomorrow (Tuesday, December 14).

Liam Randall – Local Democracy Reporter (more here).

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