A GWENT council has a near £3 million gap in its budget for the forthcoming financial year.
Torfaen Borough Council is continuing to work on plans to close the £2.85m shortfall between the amounts its service areas expect they will have to spend and regular demands on its budget but expects to have greater clarity when the Welsh Government announces its funding settlement.
The government was due to announce the provisional funding settlements of how much money will be allocated to each of Wales’ 22 local authorities yesterday (Monday, November 24).
Torfaen head of finance Rob Green said: “It is subject to confirmation but the worst case is it shouldn’t be any worse than where we are now.”
Torfaen is currently basing it planning on an assumed 2.5 per cent increase in its Welsh Government funding settlment, based on information previously provided, which would see that share of its budget increase by £4.8m. Mr Green said an increase by another half a per cent would equal an additional £0.96m to the council.
It is also using an assumed council tax increase of 4.95 per cent, but no decision on a proposed increase will be taken until it has all the budget information.
Torfaen council’s Labour leader, Anthony Hunt, who speaks for the Welsh Local Government Association on finance, said it has been lobbying Senedd Members to put pressure on the Labour government in Cardiff to put the £380m that is unallocated in its £27 billion budget towards public services such as schools and social care.
Cllr Hunt told a Torfaen council scrutiny committee: “The debate down in the Senedd is more heated than usual with elections coming up next year but we hope Senedd Members and different parties put public services first in those discussions.”
The council’s budget for the current financial year is £248m and six months into the financial year it is projecting spending will surpass that by some £600,000 which is described as a “modest adverse variance” which finance chiefs expect will reduce towards zero over the remainder of the financial year.
Initial spending estimates for 2026/27 predict financial demands will grow by just over £10m but funding is expected to increase by £7.5m leaving it with the current gap of £2.85m.
It is braced for an expected three per cent, nationally negotiated, pay award for local government workers which it has set money aside to meet, inflationary increases across all services amounting to £3.9m and increased demand for council services. All have been identified as its “most significant” cost pressures.