Ramos Leo
A senior councillor has indicated that council tax bills in Wales could still increase, despite a recently struck budget deal between the Welsh government and Plaid Cymru that promises additional funding for local authorities. Andrew Morgan, the leader of the Welsh Local Government Association (WLGA) and a Labour councillor, cautioned that while any proposed rises would be "lower than what it would have been," he still hoped significant increases, such as 10%, could be "off the table right across the board." He emphasized that the persistent demand for public services continues to "outstrip" the available financial resources, posing an ongoing challenge for local government.
The budget agreement, forged between Plaid Cymru and the Welsh Labour government, will inject an extra £113 million into the local government sector. This substantial sum is earmarked for crucial services including education, recycling initiatives, and other vital community provisions. The pact’s significance extends beyond local authorities, as it ensures Labour will avoid a potentially damaging defeat when its comprehensive spending plans for the NHS, schools, and other public services are put to a vote in the Senedd in January. Plaid Cymru has publicly stated that this deal, which also includes increased funding for the National Health Service, will serve to "protect services" across Wales.
The political landscape in the Senedd has been particularly sensitive for Labour, which holds a minority of the 60 seats. This precarious position was further complicated by the recent Caerphilly by-election in October, where Labour suffered a loss to Plaid Cymru, leaving the governing party two seats short of a majority and thus dependent on support from other parties to pass legislation. The newly formed alliance with Plaid Cymru provides a much-needed pathway to legislative stability for the Welsh government.
Under the terms of the agreement, Welsh councils are set to receive an average increase of 4.5% in the grant they receive from the Welsh government. This represents a notable improvement on the initial 2.7% boost outlined in the draft £27 billion budget, which was unveiled in October. The draft budget had previously drawn criticism and concern from local government representatives, who argued that it did not adequately address the escalating demands placed upon councils, particularly in areas such as social care.
Analysis from the Wales Governance Centre at Cardiff University has provided further context to the financial injection. Experts there have calculated that the additional £113 million is "roughly equivalent to what a 5% increase in council tax bills would raise for local authority budgets." This suggests that the new funding package offers "greater certainty and a more realistic prospect of meeting uncertain spending pressures next year without excessive council tax increases." Local authorities in Wales are primarily funded through a combination of grants from the Welsh government and revenue generated from local council tax. Each of the 22 local authorities is independently responsible for setting its own budget prior to the commencement of the new financial year.
Speaking on BBC Radio Wales Breakfast, Mr. Morgan described the budget deal as a "significant step in the right direction." He highlighted that no local authority would receive less than a 4.1% increase in funding, with some, like Newport, set to benefit from a 6.1% boost. However, Welsh government figures indicate that rural councils, including Gwynedd, Conwy, Ceredigion, and Carmarthenshire, will receive the lowest settlement, at 4.1%.
Mr. Morgan reiterated the persistent pressures facing local government, citing challenges in social care, the growing demand for additional learning needs provision, and the funding requirements of schools as areas where demand is "outstripping the amount of funding we have available." When questioned about the implications for council tax, Mr. Morgan, who also leads the Rhondda Cynon Taf council for Labour, maintained that the final decision on council tax levels rests with each of the 22 local authorities. He was unable to provide a definitive "commitment" that bills would not rise, but he strongly asserted that "any increase now will be far lower than what it would have been." He expressed a strong hope that council tax hikes of 10% are now "off the table right across the board."
The Welsh government’s Finance Secretary, Mark Drakeford, had proactively set aside substantial funds – in the hundreds of millions of pounds – when the draft budget was initially announced in October. This financial provision was widely understood to be earmarked for potential agreements with opposition parties. Mr. Drakeford had publicly indicated his willingness to allocate additional resources to both local government and the NHS.
The comprehensive deal struck with Plaid Cymru includes an additional £180 million allocated to the NHS. However, the Wales Governance Centre has cautioned that this increased funding for healthcare may still necessitate "further top-ups." According to their analysis, core NHS spending is projected to see a real-terms increase of between 1.7% and 1.8%, taking into account rising costs. While this represents an improvement on the 0.3% real-terms increase implied by the draft budget, it remains "somewhat lower than recent trends," which have seen an average annual increase of 3.3% since the 2018-19 financial year.
First Minister Eluned Morgan hailed the Tuesday agreement as a crucial development that would provide vital assurances regarding jobs and public services across Wales. Speaking during a visit to Conwy, where she was hosting the Japanese ambassador on a tour of the town and its historic castle, Ms. Morgan emphasized the need for politicians to translate their budgetary commitments into tangible support for public services.
When pressed on suggestions that her government had engaged in political maneuvering with the Welsh Conservatives, who had also expressed interest in negotiating a budget deal, Ms. Morgan declined to comment. She firmly stated, "The key thing is that we’ve got a budget deal and that means that public services in Wales remain safe for next year. That’s what people in our communities care about – they want to make sure that the jobs will be there in future and the services they rely on will be there – without a budget we couldn’t give that assurance."
The Welsh Conservatives were quick to label the Labour-Plaid deal as a "stitch-up." Senedd leader Darren Millar criticized the First Minister, stating, "The Welsh Conservatives reached out in good faith to offer a bold agenda to cut tax and cut wasteful spending in order to get the Welsh economy moving again, but the first minister was clearly playing games." This reaction underscores the ongoing political tensions surrounding the budget and the methods employed to secure its passage.
atisusanti
George Anjay
Nana Banana