Questions remain for Wales after Labour’s long-awaited UK Budget.
Prior to the Budget, myself and other Plaid Cymru council leaders in Wales wrote to the Chancellor warning that a failure to act will mean many services that protect the most vulnerable in society will disappear altogether.
While appreciating that the challenges faced by the Chancellor are significant following 14 years of the Tories’ disastrous economic policies, it is no exaggeration to say that many councils find themselves on the brink.
The Welsh LGA estimates that local authorities in Wales face additional financial pressures of £559 million in 2025/26.
Without adequate levels of funding, our schools will continue to lack the resources they need to give pupils the education they deserve. As the National Association of Head Teachers stated in its report last month, spending per pupil has fallen by around 6 per cent in real terms – an unsustainable situation if we are to truly give learners the best start in life.
Without additional funding from the Welsh Government, local authorities would require a mix of council tax increases and further cuts to services and efficiencies. The pressure is equivalent to a 26 per cent increase in council tax, or the loss of just under 14,000 posts.
I know that I speak for all local authority leaders in Wales when I say that the weight of responsibility when it comes to protecting the most vulnerable in our communities is felt more acutely than ever.
Considering the repeated pre-election pledges that two Labour governments working together would be of benefit to Wales, council leaders in Wales hoped for a fair deal from the UK Budget and that the consequential funding received by the Welsh Government would enable Welsh councils to receive the financial support we so desperately need.
While it wasn’t all doom and gloom, important questions remain.
We’ve received no real clarity on the long-term future of structural funds, and Wales was yet again denied the money it has long been owed – £4 billion in HS2 consequential funding, capital monies that the Welsh Government could use to transform public transport infrastructure, or invest in other capital schemes.
As a council leader, I believe that some of that £4 billion should be spent on improving our schools and highways. The UK Labour Government has let us down badly on that front.
Local authorities have no clarity either on whether they will be fully compensated for the hike in employers’ National Insurance contributions, or whether it’s a case of giving with one hand and taking with another.
With the Labour Welsh Government not setting its Budget until December, it leaves Welsh councils in a state of uncertainty for quite some time yet.
Currently, key services such as social care, children’s services, schools and highways all require significant investment so that our communities can thrive.
If the Labour Welsh Government fails to adequately fund local government and address the deficit of around £0.5 billion, the consequences will be significant on our communities.
It is clear that Welsh councils are standing on the edge of a financial precipice. This is the Welsh Government’s chance to step up to the plate – and after a general election campaign where Labour promised change for the better, they must deliver.
