Merthyr Tydfil Council is currently predicting a £13m shortfall in its funding for next year. That was the update given by the council’s cabinet member with responsibility for finance Councillor Andrew Barry.
In a statement, he said that over the past few months the country has been exposed to economic turmoil and the early signs are the council will be facing unprecedented financial pressures over the coming year. He believes it was important to bring that information to people at the earliest opportunity. He said: “All the indicators would suggest the financial settlement we are about to receive from Welsh Government will be poor, because of the poor settlement they are about to receive from central government.
“We are currently looking at a £13m shortfall within that funding gap. The daily turmoil you see on the TV is now putting us in the situation where we must find money to fill that funding gap or reduce services that we simply cannot afford to deliver.
“We will do everything in our power to try and close that financial gap and continue to provide those services to you. Over the past few years we’ve turned projected budget deficits into actual budget surpluses through more effective working and help from Welsh Government.
“We’ve been prudent with those surpluses and will now use those from our reserves – money which is put aside for emergency situations – to help fill that gap, however there are restrictions in terms of how much reserves we can use.” He said they will also be looking to identify further savings across all service areas and will ask residents how they think the council should prioritise services and set the council tax for 2023/24.
Councillor Barry said that the council tax income will contribute to the shortfall and help to close that funding gap further. He added: “We have been working with Welsh Government on a fairer system of council tax to reduce the burden of the second highest council tax levels in Wales, but until Welsh Government change the system we are stuck with the current position.”
He said that for next year, a 1% increase in council tax would raise around £259,000 which the council can spend on delivering services. He said that this translates to around 23p per week to the lowest band property, or 33p per week to an average Band D property.
Councillor Barry said: “This is your county borough and you need to have your say in the decision making process and how we set your council’s budget for the next year. I, and other members of the cabinet will be out and about over the next few months to talk to you about those decisions on our Budget Consultation Roadshow. You can also complete the online survey. Paper copies are also available at the civic centre.”
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