Council faces £17m funds gap
MERTHYR Tydfil council is facing a budget gap of more than £17 million over the next four years.
Figures from a report set to be considered by cabinet show a £17.2 million deficit between now and 2022 and a £5.6 million gap for 2019/20 with a predicted council tax increase of 4.15%.
Every further 1% increase in council tax over and above the 4.15% brings in an extra £270,000 for the council.
The budget deficits are revised figures from what was initially forecast in the medium-term financial plan earlier this year which showed a £6.5 million deficit for 2019/20 and a £13.7 million gap between now and 2022.
The factors which have made the council revise these figures include the provisional Welsh Government settlement, corporate additional demands, corporate budget reductions and schools’ budget reductions.
The provisional Welsh Government settlement announced last month showed a 0.3% increase ( £303,000) for Merthyr Tydfil in 2019/20 which is the second best of all councils.
The Merthyr Tydfil Schools Forum has identified £694,000 worth of savings in each of the next three financial years.
These could be covered in part by school meal prices increasing which will go out to consultation before a report comes before cabinet at the end of the year.
In primary schools, there would be be an increase from £2.10 per meal to £2.25 per meal in April 2019 and a further increase to £2.40 per meal in September 2019.
In secondary schools, there would be an increase from £2.50 per meal to £2.65 per meal in April 2019 and a further increase to £2.80 per meal in September 2019.
The council says it is still waiting for news of any additional funding from Welsh Government following the UK Chancellor’s announcement in the budget last month that Wales would get an extra £550 million.
The council is also waiting to hear more information about certain grants including the social services grant and schools funding grant worth £30 million and £15 million across Wales respectively.
The authority also hopes that an increase in the teachers’ pensions liability for local government will be centrally funded.
For Merthyr Tydfil this currently costs £715,000 for 2019/20 with a projected full-year cost of £1.3 million.
Full council agreed last month to a voluntary redundancy/early retirement package for employees expressing an interest no later than November 16 with the authority expecting this to lead to significant savings.
The final local government settlement for Wales will be announced on December 19.