A 4.7% increase in council tax has been passed in Merthyr Tydfil through the casting vote of the independent mayor after the opposition Labour group voted against it. The budget and council tax increase was recommended by cabinet to full council for approval on Wednesday, March 8, and after a vote which saw 15 vote in favour and 15 against, the mayor, Councillor Declan Sammon, used his casting vote to pass it after Labour opposed it, raising concerns about the level of council tax rise and the budget setting process.
The council tax rise means that a Band D property would pay £1,828.34 for 2023/2024 which is an increase of £82.07 or £1.58 per week. The report said that as 84% of the properties within the county borough were valued at Bands A to C, a significant proportion of council taxpayers would pay less than £1,828.34.
The 4.7% council tax increase is set to generate extra income of £959,000 for the council. It also mentions the council tax reduction scheme for 2023/24 which council has approved and provides support with council tax payments for those residents eligible to apply.
The increases range from an extra £1.05 per week at the lowest Band A to £3.68 per week at the highest Band I. There was an initial budget deficit of £5.462m which was reduced to £2.195m
This was after taking into account the £4.062m impact of the Welsh Government settlement, £4.547m for the pay award, £2.344m for energy costs, £4.288m for new demands, the Real Living Wage and inflation, £1.789m from employee cost reductions, £1.304m for capital financing costs, £475,000 of extra money through the Welsh Government homelessness prevention grant, £3.924m from budget savings and cuts and £5.5m from the use of reserves. The budget savings and cuts include £1.5m from schools, £1.6m in operational savings and £900,000 in strategic savings.
The council has also saved £49,000 as a result of confirmed inter agency fees for adoption placements together with a review of trend data relating to direct payments and £13,000 from education as a result of a reduced contribution to the Central South Consortium, and these add up to £62,000. At the meeting, council approved plans to charge a council tax premium on long term empty properties from April, 2023, and second homes from April, 2024, and the report said that the outcome of the consultation was significantly in favour of charging council tax premiums for these types of property and a 100% premium would charged for both.
For 2023/24 this is set to bring in additional income of £374,000, assuming a 30% reduction in chargeable properties within the scope of the council tax premium regulations. The projected income takes into account £40,000 towards a post to carry out the administration of the scheme including inspection, collection and recovery.
The report said that the council’s continuing transformation programme would generate additional in-year savings throughout the 2023/24 financial year and address the projected budget savings needed over the medium term. It will cover all services with the focus for 2023/24 on current ongoing reviews within the corporate part of the council, social services and neighbourhood services and savings of £798,000 are needed for next year.
On the fire and rescue services pensions, the report said central grant funding for 2023/24 had now stopped and instead extra money had been transferred into the revenue support grant to compensate. The net effect to councils is neutral since the Fire and Rescue Service will increase its levy and the amount totalled £115,466, the report said.
The report added that the final settlement provided extra grant money of £2,000 because of some minor settlement formula changes. As a result of £62,000 of extra adjustments, £959,000 from the council tax increase, £374,000 from the proposed council tax premium, £798,000 from the transformation programme, £115,000 towards the increased fire service levy and £117,000 in the increased revenue support grant, the budget gap is closed.
The final settlement from Welsh Government on February 28 confirmed a funding increase of 7% for Merthyr Tydfil Council next year. The proposed budget requirement for 2023/24 for the council is £152.654m, up by 6.54% on last year.
Why the Labour opposition said they couldn’t support the budget
Councillor Darren Roberts, leader of the opposition Labour group, said that the budget setting had been “painful,” “drawn out” and “left to the last minute.” He said that the Labour group only knew about the 4.7% figure two days before the reports were released and that they had proposed a budget with a 2.35% increase but this was deemed unsustainable.
Cllr Roberts said that Merthyr Tydfil’s council tax was already the second highest in Wales and he said that although they understood the pressure the council was facing, residents were facing their own pressures. He said the 4.7% rise was a “bitter pill” for all residents to swallow.
Fellow Labour councillor Brent Carter said: “We found ourselves in deeply troubling times” and that sustainability was proving to be a major challenge. He said they were having to make difficult decisions and residents were experiencing hardship with the cost-of-living crisis, adding that they must be mindful that Merthyr Tydfil had severe deprivation issues.
Cllr Carter said there had been a “complete lack of leadership, direction and decision making by cabinet” saying it was an “inexperienced cabinet” asking whether they were cut out to lead the authority through troubled times. He said there were controversial business cases put forward that were taken out by cabinet and later he said, “perhaps it would make them unpopular” adding that “no hard decisions are popular.”
He said it was “not acceptable” and “not good enough” that they only knew about the 4.7% figure last week. Cllr Carter said it would’ve been so different if they had accepted the olive branch from Labour but said that the independents had chosen “power over people.”
He said: “We have got to step up and make the difficult decisions” adding that the independent group “can’t hide behind populism anymore.” Councillor Anna Williams-Price, Labour, highlighted the irresponsible policies of the Tory Government under Liz Truss and said the council had got a better than expected settlement from Welsh Government.
She said there was a unique political situation in Merthyr with 15 Labour and 15 independent councillors and that Labour had been calling for more information but cabinet refused to discuss council tax. She said she was disappointed that there had been no serious attempt at cross-party working and said it was not a budget that worked for residents.
Councillor Kevin Gibbs, Labour, said the budget decision had been left until three days before the deadline adding that they were one of the last councils in Wales to make a decision on council tax. He said residents had called for them to work together but the idea of a coalition was rejected after the election.
He highlighted comments from the cabinet member for finance about the council being in the best financial position it had ever been in but Cllr Gibbs mentioned the positive Welsh Government settlements and said the council finances were in “dire straits” at the moment. Councillor Clive Jones, also Labour, said council tax payers were “fed up to the back teeth” at the way the Tory government had treated public services, public bodies and employees.
He said the blame landed entirely at the door of the Conservative Government and he said the sooner they were gone the better it would be for the public sector and local authorities in particular. Councillor Jamie Scriven, Labour, said the £1.5m education cut was “not acceptable” as residents were asking them to prioritise education and said that people would be more accepting of service reductions than the burden of 4.7%.
He said there were still business cases to come forward and that this budget “is going to be the death note for many.”
The view of the independents
Councillor Lisa Mytton said she wasn’t necessarily against a coalition but it didn’t happen and asked what was stopping Labour making these very important decisions in the interests of the people of Merthyr Tydfil to show that they could work together and make these difficult decisions. She said the Tory issues that they all had to deal with had been “disgusting” and that they had left the country in “wrack and ruin” and that the council had had to pick up the pieces.
She said they had got to go forward and had to try to balance the budget and asked Labour where they were going to find the money for a lower council tax. She said that if they were to do what was right by the people of Merthyr Tydfil “forget the politics. Let’s make the difficult decisions.”
Councillor Andrew Barry, independent cabinet member for finance and deputy leader of the council, said he was “astounded” at the comments made by Labour and that he was “not going to get into gutter politics.” He said that they criticise and berate and then said ‘will you work with us’.
Cllr Barry mentioned the surpluses that the council had made over the last few years through “prudent management” adding that it “doesn’t sound like an organisation in chaos.” Cllr Barry said that Labour talked about inflation and rate rises and then they said perhaps they could use more reserves and lower council tax.
He said: “This is business. This is about balancing the books” adding that some of the Labour figures and insults “are beyond belief” adding “do you really think we want to work with people who want to insult us and berate us at every turn?” He said cabinet members were doing a great job and that the work in social services was “ground breaking.”
He said, of course, education was a priority but they had to balance the books. Cllr Barry said they were ranked 18th out of 22 councils in the Welsh Government settlement adding that “the Labour Party gas turned its back on the south east Valleys.”
He agreed that the Tories needed to go but said he was “worried about Labour coming in” and said that they had lobbied ministers about changing council tax. Councillor Michelle Symonds, independent cabinet member for public protection, said she was not inexperienced and that she had the same right to be there as anyone as she was an elected member.
She said she’d lived in Merthyr Tydfil for the last 30 years and lived through the difficult times when Labour was in power for quite some time, adding “the legacy of which we are still suffering from.” She said she’d listened to residents and been honest with residents and that she had the integrity to make and stand by difficult decisions.
Councillor Michelle Jones, independent cabinet member for education, said: “We have worked tremendously hard for our residents.” She said they’d gone through and scrutinised this budget, “like you wouldn’t believe.”
She said: “We have tried to not cut services” adding that they don’t want services cut from residents. Cllr Jones added that they were doing their best with the funds that they had and trying their best to balance the budget.
The mayor, Councillor Declan Sammon, independent, said the 4.7% would have left all members with a bitter taste in the mouth and it was not something they wanted but said this council and every other council had “again been let down by those holding the purse strings.” The leader of the council, Councillor Geraint Thomas, independent, said it had been a “difficult process” and the sands had been shifting so fast and that teacher’s pay had not been resolved.
He said they had been questioned on integrity and not working with the Labour group but he said that they had monthly meetings with Labour where they had full access to officers and cabinet, adding that council tax would’ve been lower with the Welsh average level of funding.
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