'Where next for local services?' - the question following huge cut to council budgets

Wednesday, 08 October 2014

With local services placed ‘bottom of the pile’ of Welsh Government funding priorities for a second year running, council leaders believe a tipping point has been reached that could result in the disappearance of key services.

Speaking directly to their communities, councils leaders have issued a stark warning that a cut of almost £150million to their budget in 2015-16 means they will be forced to reduce many treasured local services now and into the future.

Having worked tirelessly over the past five years to save millions of pounds while protecting front-line services, local government shares the frustration many communities in Wales will experience as their local services are scaled back in a way that no one wishes to see.

Cllr Bob Wellington CBE (Torfaen), Leader of the WLGA said:

“Councils in Wales have not shied away from difficult decisions. They have already been forced to deliver a wide range of cost saving measures, often in the face of strong but understandable public opposition. Austerity is set to last well into the future and we urgently need our national politicians to show leadership, to support the difficult decisions made locally and to start setting clear and realistic priorities for public services in Wales as a whole.

“Within the latest Welsh Government budget, local councils have once again been asked to shoulder a disproportionate share of the austerity burden, and it is time for politicians at all levels to be honest about what this actually means for the communities we serve.

“The financial issues affecting local government will impact on us all. They will impact on the range and quality of the services we receive, the taxes and charges we pay and they will impact on the very fabric and resilience of communities in Wales.”

Cllr Aaron Shotton (Flintshire), WLGA Deputy Leader and Spokesperson for Finance said:

“The seriousness of the budget today must be viewed through the lens of 15 years of devolution. With austerity set to continue into the next Parliament, spending on local public services has been placed firmly in reverse gear and has been returned to levels similar to those experienced back in 2001. This means councils will be trying to respond to current levels of demand, and manage contemporary issues such as significant population growth, with the same level of financial resources they had over 14 to 15 years ago.
“The draft settlement for local government has slashed almost £150million from our budgets at a single stroke, with additional cuts in the system also planned such as a reduction to the wider Supporting People budget as well as an ‘in-year’ cut to vital education funding.

“The current system for funding local councils is broken. It is high time for all those involved in public policy in Wales to address this, and the WLGA is calling for the establishment of an Independent Commission on Local Government Finance to examine the sustainability of council funding into the future.”

Councillor Hugh Evans (Denbighshire), Leader of the WLGA Independent group said:

“No local council leader entered politics to cut services or close vitally important community facilities, but in being legally obliged to set a balanced budget, this is the position that we now find ourselves in.

“The two biggest services in local government are education and social services. Together they account for over 65% of our total spend, and with Welsh Government insisting that education spend remains protected it is unavoidable that other services are being dismantled to fund this. The further budget cuts that will now need to be made within these smaller service areas will undoubtedly see many of them begin to fail completely in the future.

“We need the public to help us address this. Councils want to save those preventative services like social care that help stop people going into hospital, we want to ensure that the young sportsmen and women of the future have leisure centres in which to train and grow their skills, and we want to protect the day centres that support many of the most vulnerable within our communities. To achieve this local services must be prioritised and adequately funded by Welsh Government, not simply cut to ribbons.”

Councillor Dyfed Edwards (Gwynedd), Leader of the WLGA Plaid Cymru group said:

“The decision to place more funding into health services is understandable and welcome. However, we need to ensure that we take a long term view of the funding of health and social care otherwise there is a danger that preventative services, which will help deliver more sustainable public services in the long term, will be undermined.

“From housing, social care, environmental health and leisure, local government services prevent hospital admissions and keep people out of the NHS. Cutting them will simply increase the pressure on our NHS in the future, whose Local Health Boards have once again had to be bailed out despite increased funding last year. There is a danger that cutbacks to the local government budget will simply store up problems for the years to come rather than empowering local councils to continue to address the causes at source. We need to ‘invest to save’ otherwise austerity will create generational damage across Wales.”

Councillor Peter Fox (Monmouthshire), Leader of the WLGA Conservative group said:

“Councils are working closely with their local communities to help shape a response to the significant financial challenges they now face, and from feedback received right across Wales it is clear that people care deeply about their local public services.

“Welsh Government can no longer continue to simply blame Westminster for the level of cuts that now threaten the sustainability of our local public services. There are conscious choices also being made in Cardiff Bay, by our Government here in Wales, which are placing local services under threat as never before. It is time for Welsh Government to stop the ‘spin’ about local funding and accept that further cuts of this scale run the risk of creating comprehensive failure across many of the most highly valued public services delivered by local government in Wales. The idea that a distant local government reorganisation, which at minimum is three financial years away and will cost millions to implement, offers any salvation from these problems really does strain credibility.”


Annex 1 – The Hard Facts

Today’s announcement of by Welsh Government of a further drastic cut across council budgets should be explained clearly:

• The announcement of an ‘extra’ £10m for Social services barely accounts for a fifth of the overall cost of demographic pressures that already exist in the system. Neither does it make up for the cut of the £50m of the Intermediate Care Fund. Social services are effectively £90m down already.

• The £44m Pupil Deprivation Grant, although welcome, goes directly to schools and can only be spent in schools whose funding is already protected. It is not alleviating any of the pressure on other local services.

• It is true that local services have been protected more than our English counterparts between 2010 and 2013, but this does not mean that services have not been cut over the period. Welsh Government figures support this.

• Since the onset of the recession the local government budget for economic development is down by 34%, regulatory services by 30%, culture, sport and leisure by 27% and libraries by 19%. The reason for this is that flat line settlements do not keep pace with costs, demographics or inflation. Look at Welsh Government, their budgets are flat and yet they have had to cut £1.7bn.

• Local government reorganisation is offered as a solution to these problems but the earliest this could happen is 2018. There is no legislation yet in place. There are three financial years between now and then and everyone is aware that the new councils will cost millions to set up. While the Williams report tells us that creating 12 authorities could save between £60-£80m per year in the future, by 2017 alone we will have taken out £900m from council budgets.

• As last week’s Western Mail headline stated the situation on the ground is “£425m extra for the NHS - but other departments see budgets slashed”. The contrast is now sharp. In the past year we have lost an estimated 3000+ jobs while the NHS has gained 400. Since 2009-10 there the real terms financial growth in the NHS budgets provided by Welsh Government has been around 6%, in local government there has been a reduction of 10%.

• ‘Get rid of expensive officers and councillors’ is a constant call from members of the public and media. Local Government reorganisation could see a 50% reduction in Chief Executives and Senior Managers and a possible 50% reduction in the number of councillors. At most this will save around £18million, which will do little to solve the £900m million budget shortfall local councils expect to experience in the next three years.

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