Council £23.8m budget hole: Plaid Cymru group “incredibly concerned” over impact of in-year cuts on staffing and services

Wrexham Council’s Plaid Cymru group have said there are “many questions for the council’s leadership to answer” as an emergency report is set to be presented tomorrow to the Executive Board.

Last week councillors were told the local authority has a £23.8m hole in the projected budget for this financial year, with concerns so great that immediate steps are being taken to get it back under control. They include all departments being told to identify in-year savings of up to 15% with ‘all areas of expenditure and income’ to be examined to ‘bring the budget back in line’.

The sum is 7.8% of the overall budget for Wrexham Council and is being blamed on a lack of funding from Welsh Government, and in turn UK Government, to reflect the now common volatility of finances – with the council pointing to knock on effect of pay rises, spiralling costs of already expensive social care placements and general inflationary increases

You can read more in the article from last week: Council’s £23.8m budget black hole just two months into financial year prompts ‘immediate action’

Today the Plaid Cymru group have given their view on the situation, firstly giving a quick basic down of the budget – and how the situation has evolved in their eyes:

WCBC has a £303m annual budget – excluding housing, which is ringfenced in what’s called the Housing Revenue Account.
– About a third goes on Education
– About a third goes on Social Care (children’s and adults), which is £18m over budget
[Spending on social care has increased from £57m in 2019-20 to £103m in 2023-4 due to growing costs of caring for children, the elderly and disabled]
Of the remaining third of the budget, about a half goes on Environment and Transport – waste, roads and a host of other environmental services.

So how did we get to this? Why are we in crisis mode just two months into the new financial year? And, just as importantly, how do we deal with the black hole?
There have been four proposals put to us:
1. Increase income from services the council charges for.
2. All departments are required to make 15% savings in year
3. The two departments with significant budget pressures – Social Care and Environment – are being asked to make savings but that is difficult in the context of their existing budget pressures.
4. Stop non-essential spending (e.g. on external consultants, overtime and agency staff)

Plaid Cymru group leader Cllr Marc Jones said, “The potential to make savings on frontline services is minuscule (e.g. cutting the council’s contribution to PCSOs). Increasing costs for residents (e.g. crematorium fees and green bin costs) are equally small. There are minimal opportunities to make savings in Education, Social Services and other statutory services, therefore the remaining services are being asked to find 15% savings to make up the difference.

“As a group, Plaid Cymru councillors are incredibly concerned about the impact of making in-year cuts will have on staffing and the services being provided for residents. The past 13 years of austerity and cuts have already meant that many council departments have the bare minimum of staff so how will they make savings without impacting on key services?

“The idea of not spending on non-essentials is something we welcome but have to ask why it’s taken this emergency to bring it to light. How many consultants has the council employed that were non-essential? How many out-of-county trips were made that were non-essential and how many agency staff has the council employed that were non-essential?

“The loss of experienced social workers in previous years has led to a dependence on costly agency staff – we want to understand how much is currently being spent on agency staffing and why it has not been addressed more promptly.

“Everything so far points to council staff being put under greater pressure. That’s the last thing we want to see and we, as a group, will do all that we can to mitigate any decisions that would cut services and staff.

“Before we can do that, we need better understanding of what the council spends its money on and why. It’s likely that the council will have to pause non-essential works, which could mean greater costs in the long run as costs increase. But it could also mean a re-prioritisation of service delivery and greater accountability for what the council spends.”

Councillors will meet tomorrow with the opportunity to discuss the report before the Executive Board that has a handful of immediate budget actions, along with the request for departments to come back with saving suggestions in the future.