Cabinet will consider the latest budget consultation feedback and could recommend a final strategy for 2023/24 to full Council. The strategy responds to the financial challenges faced by Rhondda Cynon Taf which are similar to all local authorities in Wales, protects residents and services as much as possible, and continues to invest in priority areas.
On Tuesday, February 28, Cabinet will consider a report that outlines the feedback received in Phase Two of the budget consultation, which ran from January 24 to February 6. The process gave residents and interested stakeholders the opportunity to have their say on a draft Budget Strategy, agreed by Cabinet in January.
All councils continue to face unprecedented challenges in the short and medium term, alongside increased pressures on local services due to the ongoing impact of Covid-19 and the cost-of-living crisis.
Our budget gap for next year is £38.3m, reflecting the significant budget pressures being experienced – after taking into account the provisional Local Government Settlement that provides a 6.6% budget increase for Rhondda Cynon Taf in 2023/24. The draft Budget Strategy addresses this position and outlines proposals to set a legally-balanced budget.
If agreed, the strategy would continue to protect the Schools Budget, which has been increased by 28% over the past 10 years. The proposal for next year would fund all pressures on our schools that arise from pay, inflation, energy costs, pupil number changes and Additional Learning Needs – with the need for schools to contribute through an efficiency saving at a significantly lower level than other services across the Council.
The strategy proposes one of the lowest Council Tax rises in Wales next year at 3.5%, continuing our position of setting the lowest average rise of all Welsh councils over the past five years. The proposal would see us continue a responsible approach when setting Council Tax levels, balancing the impact upon services and the ability of the public to pay.
The strategy also proposes to use earmarked reserves to make a one-off £5m contribution towards energy costs, which are forecasted to spike in 2023/24 – along with £4.1m from the Transitional Funding reserve to support an overall balanced budget. We have a track record of using reserves sensibly when setting our budget, and we have tried and tested arrangements in place for reserves to be replenished over time.
Other key elements of the strategy include the identification of £16.1m savings from efficiencies next year, following a detailed review across all service areas. Council Fees and Charges would have a standard 5% increase, which is significantly below the rate of inflation, with some fees and charges subject to specific treatment.
Councillor Andrew Morgan OBE, Leader of Rhondda Cynon Taf Council and Cabinet Member for Infrastructure and Investment, said: “Cabinet Members will consider the feedback received in the second phase of this year’s budget consultation, and could recommend to Full Council that the draft Budget Strategy for 2023/24 is adopted when it meets in March 2023.
“This is an incredibly challenging time for Local Government, with all councils having to make difficult decisions on their finances. We face increased costs like every household across Rhondda Cynon Taf, with energy bills for schools, care homes, leisure centres and community buildings forecasted to rise by 300% next year. Food inflation is increasing the cost of the meals we provide to schools, care homes, and households via the Community Meals service. Overall, our costs for 2023/24 are estimated to increase to a level that is £38m higher than the funding available for next year.
“However, the Council has a history of making responsible financial decisions, and our continual forward planning has put us in a good position. Work started very early on the forthcoming budget, and we are proposing no compulsory redundancies, while the agreed service changes in Waste Management, Community Meals and the council-run Nursery provision will enable the continued availability and delivery of valued services. The overall position is positive, considering the outlook just a few months ago, and has been achieved through our proactive approach to dealing with unprecedented budget pressures.
“Our proposed 3.5% increase in council tax will again be one of the lowest rises across Wales, with the Council already setting the lowest average rise in Wales over the past five years. The 2023/24 level will avoid an excessive increase that could have been considered given the financial challenge we face – and most councils in Wales are considering an uplift of over 5%. The proposal is one that represents a fair uplift, ensuring relied-upon key services are protected.
“The Senior Leadership Team has also considered efficiency savings across each and every Council service. The £16.1m savings that have been identified are as a result of an exceptional review process and have been achieved on top of the multi-million pound savings made in previous years. The review process undertaken by senior officers has provided assurance that the latest savings can be delivered without a significant impact on services.
“It’s also pleasing that the strategy includes funding all financial pressures on our schools – which relate to pay, inflation, energy costs, pupil numbers and Additional Learning Needs. The schools budget has increased by 28% over the past 10 years and the proposed strategy ensures that our schools will continue to be prioritised.”
Posted on 21/02/2023