Councils facing deficit of ?609m

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  • xman
    Admin
    • Sep 2006
    • 24007

    Councils facing deficit of ?609m

    </span></span> Local authorities have drawn up projections for future budgets
    Welsh local authorities are predicting a budget shortfall of &pound;609m over the next three years as public finances are squeezed.

    Figures obtained by BBC Wales show that authorities are planning for cuts of between 5% and 20% to their budgets.

    Cuts for 2010/11 will be absorbed by the Welsh Assembly Government.

    Steve Thomas, chief executive of the Welsh Local Government Association, said the figures were "conservative predictions".

    Mr Thomas said the level of cuts was "frightening, but could be even worse yet." and he was concerned they could last a decade.

    "You can't keep inflicting this level of pain over an extended period," he said.

    Figures for Wales' 22 local authorities reveal that councils are planning for deep shortfalls between the budgets they will raise through council tax, the grants they receive from government and their expenditure on services.

    CASE STUDY - CAERPHILLYProjected budget shortfall of &pound;26.8mFears shortfall could rise to &pound;40mIntroducing "radical and challenging solutions to make our money go further"Biometric payment system for school dinnersMoves to reduce office accommodationLooking at how they manage various community assets, such as leisure centres
    According to the figures obtained by BBC Wales local authorities are projecting a budget shortfall of &pound;203.8m in 2011/12 and &pound;609.1m for the three years up to 2014.

    The figures have been drawn up by councils on the expectation they will receive cuts of 3% to revenue and 10% to capital from central government.

    Any increase to that will mean many more millions lost from their budgets.

    The UK government will announce the details of its Comprehensive Spending Review next month, as it attempts to cut a national debt expected to reach &pound;900bn in the next few years.

    Local authorities will then learn the details of their grant and are expected to detail which services are to be protected or hit in the coming years.

    "Local authorities will seek to protect those statutory services; children's services are not going to cut; the education agenda won't be cut," said Mr Thomas.

    &ldquo;Council tax has on average doubled in the last 10 years... but we've seen no improvement in services&rdquo;

    Taxpayers' Alliance
    Dr Andrew Crawley, senior lecturer in economics at the University of West England and formerly Glamorgan, said cuts to councils were favoured by central government because they were "a quick way to bring down the deficit".

    But he warned: "There will be a huge spillover effect on the local economy.

    "In Wales where public sector employment is so high, and in areas like Swansea where it is over 30% there will be a knock on effect when jobs are lost."

    Earlier this year Local Government Minister Carl Sargeant said his door would be open to local authorities facing problems.

    A spokesperson for the minister said the assembly government had been "pushing the UK government hard to recognise the vital importance of protecting essential front line services and to minimise risks to the fragile economic recovery".

    "While we have made prudent assumptions in starting to prepare next year's draft budget it would be inappropriate to speculate on any impact the UK government's review may have on local government services in Wales," the spokesperson said.


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    Wales' largest councils in terms of population - Cardiff, Swansea and Rhondda Cynon Taf - are planning for a total shortfall of &pound;164.1m over the next three years, more than a quarter (26.9%) of the total deficit for Wales.

    BBC Wales understands that the Vale of Glamorgan and Conwy's predictions are based on being able to increase council tax by up to 5% over the next three years.

    A spokeswoman for the TaxPayers' Alliance, which opposes all increases to taxation, said councils should be focusing on spending cuts instead.

    "We need to balance the country's books but by cutting spending and not by raising taxes.

    "Council tax has on average doubled in the last 10 years. But we've seen no improvement in services."

    Caerphilly Council said it was introducing "radical and challenging solutions" to make money go further as it fears its shortfall could rise to &pound;40m.

    &ldquo;We have already started work to remodel our workforce and will continue to reduce the number of people we employ&rdquo;

    Colin Mann Caerphilly council
    Colin Mann, deputy leader of Caerphilly council, said: "We have already started work to remodel our workforce and will continue to reduce the number of people we employ. "

    He added: "The main message I want to deliver is that although the next few years will be tough, we will do everything possible to limit disruption to key services and ensure our residents continue to receive good value."

    Rodney Berman, deputy leader of Cardiff council, said the authority was still drawing up its options and was waiting to find out "just how bad" the settlement from local government would be.

    According to the figures obtained by BBC Wales, Cardiff is projecting a shortfall of &pound;56m over three years.

    He said the authority would not be pushing for council tax rises above 5% a year.

    "We cannot keep asking the public to shell out more and more on council tax. Any higher than 5% and we would be capped by the Welsh Assembly Government."

    "We have to think about what people can afford to pay in council tax and what we can afford to deliver in terms of services.


    This article is from the BBC News website. ? British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.


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