Local authorities are in "short-term survival mode" and "beyond the pretence" of planning for the medium term due to UK financial instability, Swansea Council's director of finance has warned. Ben Smith said the council faced an energy price "cliff edge" next April when targeted support from the UK Government was due to end and the council became exposed to soaring cost increases after its fixed price contracts came to an end.
Inflation was also much higher than forecast for when councillors set the 2022-23 budget earlier this year. Mr Smith also said that council staff were being offered a minimum pay rise of £1,925 next year - equating to an average 7-8% increase - as part of national negotiations, which was far more than the 3% the council had budgeted for. It means the council would have to find an extra £12 million unless the pay rise to be agreed was covered in full by central Government.
Mr Smith added that it was by no means assured that the Welsh Government would continue to cover deficits in council tax collections, as it has done since the Covid pandemic.
