The leader of Vale of Glamorgan Council said this year's budget setting process, arguably one of the most difficult in its history, was "horrible". During the months leading up to the council meeting on Monday, March 6, which saw the council's budget voted through, officials were sitting down for regular meetings where numbers were crunched and difficult decisions were made.
Following a better than expected budget settlement from the Welsh Government, the council is facing a budget deficit of about £9m. However, the gap the authority was facing was more than triple that much before receiving its grant. When we really bottomed it out, I have to say, I felt sick", said the leader of the Vale council, Cllr Lis Burnett, when asked how it felt when the reality of potentially having to close a £28m gap became apparent.
"When we first faced it that was when we were saying we don't know how we are going to do this without cutting back to statutory services." That's not to say that the £9m gap is seen as something which will be easy to deal with. As part of its budget, the council approved a 4.9% council tax rise.
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Some of the other changes include an increase in social care day service fees, a price hike for café-style licences for outdoor seating, and increased charges for allotment rents. There was strong opposition to the plans for a 4.9% tax rise, with the Conservative group putting forward an alternative proposal for a council tax freeze and the Plaid Cymru group calling for a more modest increase of 2%.
Both groups suggested the council should use its general fund reserves, amounting to £11m, to fund these alternatives. There are a number of reserves that the council has. These include ring-fenced reserves, service reserves, general fund reserves and risk and smoothing reserves. It is the latter type, which is normally used for smoothing out immediate and relatively short-term financial pressures that the council has opted to use this year.
Cllr Burnett said: "We have used reserves. We have used £2.8m in reserves to do that sort of thing and some of the pay increases that we have had to do that were unfunded. They were the spikes and we smoothed that out so we didn't have to pass that on. To take any more out would not only render us in quite difficult areas in terms of having that general fund which is below the designated amount, but for next year it is projected to be even worse and what are we going to do then?"
On the general fund reserve, Cllr Burnett added: "That is for the totally unexpected stuff and we are advised to have between 3% and 5% of our total budget in that." Some councillors argued that the current times justified the use of general fund reserves, with people across the county continuing to struggle with the cost of living. At the budget setting meeting, leader of the opposition at Vale Council, Cllr George Carroll, said: "The council tax rise proposed is not necessary with £11m in the bank."
Referring to the use of general reserve funds for a rainy day only, he added: "It is raining and it is now time to use [it]." When asked if now could be seen as the right time to use general reserve funds to ease the financial burden on people, Cllr Burnett said: "Yes, I can see how people might argue that, but right back of the start of the budget setting process we set out our priorities and strategic direction and that was to support our most vulnerable.
"So, we need to make sure that we are in a position to do that. If you have got one child with complex needs going into care, that could cost you half a million a year. In terms of the types of things that we are coping with, if you look at the elderly who need care packages, is it right that we expect our carers not to have a decent wage? We need to be able to pay that because at the moment it is probably easier for them to go and work in Aldi or Lidl, but actually we want them to help us to look after elderly people.
"It is a juggling act. We brought [council tax] down as far as we could. We brought it down below the Welsh average, and we have to continue to make those difficult decisions."
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