NEW CITY TAX RISE WARNING
CITY LEADERS CONSIDER TAX HIKE TO HELP PLUG £91M SHORTFALL
RESIDENTS could be asked to pay even more council tax as Cardiff council needs to plug a £91m funding gap over the next three years.
Council tax in Cardiff was increased by 5% in March as the council looked to juggle government funding cuts and increased demand for services.
But now the council is looking to increase council tax again, and is warning some services may be cut as it looks at an even larger black hole in its funding.
A model the council is considering would hike council tax by 4.3%, but that has not been finalised.
The council, which has also had to save £145m over the past five years, and £14m this year, will launch a consultation on how it could balance the books.
A budget strategy, set to be approved by Cardiff council’s cabinet on July 12, sets out £66m in savings for the next three years – with the remaining £25m coming from an increase in council tax, capping schools’ budget growth and the council’s reserves.
Councillor Chris Weaver, Cardiff council’s cabinet member for finance, has admitted some services may disappear.
He said: “It’s very concerning. It comes on top of many years of hard savings.
“It’s a real challenge and it gets harder every year.
“When you’re talking about £91m over three years we’re concerned that services will be put under pressure.”
Schools and social services would be given extra cash to manage rising demand, but efficiency savings could still be made in those areas.
Other departments of the council could face funding cuts, councillor Weaver said.
Cardiff council still wants to improve the city’s schools, roads and transport infrastructure and create jobs, said councillor Weaver, but it will be unable to offer some services in the future due to the cuts.
He said: “We always want to prioritise front line services that affect people day-to-day.
“We want the streets to be clean and for the city to work in the best way it can.
“The challenge we have got is that austerity is continuing for three years to come.
“Every service area is under strain if these cuts continue.”
The council’s current budget is £609m, but 65% of this (£397m) is spent on schools and social services.
If the budget strategy is passed on Thursday, the council would seek expressions of interest in voluntary redundancy from its staff.
Councillor Weaver said the council will consult with unions and staff over any redundancies.
He said: “It’s been a pretty horrible time to work in the public sector for many staff over the last seven years.
“There have been job reductions in this council and every other local authority.
“I fully understand how difficult it has been. Staff have done a fantastic job in delivering services.”
The budget strategy to be discussed on Thursday will recommend that plans are drawn up to address a budget gap of £34m in 2019/20 and £91m over the next three years.
Over the summer residents will be asked their views on the services which most matter to them in the Ask Cardiff survey and there will be a more detailed consultation in the autumn.
Councillor Weaver said public sector budgets have been squeezed by UK Government for too long.
He said: “There has to be a change in direction or we will see our services in real trouble.”