A TURNAROUND in a council’s financial fortunes has been credited to the Labour governments in Cardiff and London.
Torfaen Borough Council’s Labour leader Anthony Hunt said additional investment in public services has helped it address what had been an anticipated £20 million funding gap earlier in the financial year based on increased costs and the amount of funding it expected to receive.
Planned savings reduced the shortfall to £5.7m by November but an increase in the amount of money available to the Welsh Government, following the Westminster Labour government’s autumn budget, further improved the council’s position.
Torfaen received a 4.8 per cent increase in funding from the Welsh Government which is above the 4.3 per cent average increase for local government across Wales.
As a result, and following the changes the council had already planned in anticipation of a lesser funding award, it has £3.2m more available than had been expected.
The additional funding will support extra investment in schools, worth £5.3m which includes spending planned before the December award, an extra £1m to maintain services at existing levels of demand of around 1,030 clients in adult social care, and a further £1m to support changes to reduce the cost of children’s social care.
Cllr Hunt, who represents Panteg, told a council scrutiny meeting: “These choices can only be afforded due that extra money flowing down from the Welsh Government and consequentials from the UK Government.
“We were planning at the start of the year for a £20m budget gap and one per cent, or cash flat, increase.”
Latest spending figures show the council’s current in-year budget position is £1.3m over budget, reduced from £2.3m in September, due to additional funding for the current year received from the Welsh Government.
Finance officer Robert Green told councillors the reduction in spending is a “step in the right direction” and the cabinet has agreed a plan to address children’s social services that has consistently been over budget.
He said: “I’m confident the position will improve between now and the end of the (financial) year.”
Reform Party councillor for Llantarnam David Thomas asked what preparations the council has made for increased National Insurance contributions.
Mr Green said that is expected to cost the council an extra £2.5m with the UK Government having indicated it will meet that cost, though details are unlikely to be known until early in the new financial year. The council will also hold a contingency to cover an expected £75,000 increase in costs for its third-party social care providers if central government doesn’t meet that increase.
Mr Green also said, in response to Cllr Thomas, it is estimated the increase in the Real Living Wage, which is an enhanced rate above the legal minimum, will cost social care providers £1.6m.