Carmarthenshire Council is facing challenging times ahead as it grapples with yet another budget shortfall, paving the way for what council members are predicting to be a collection of “bleak winter months.” The council, like many others, is in the process of planning for the upcoming 2025-26 financial year while also updating its three-year budget outlook. However, a significant hurdle lies in the uncertainty surrounding wage increases that are beyond their control, coupled with the pressing need to curtail overspending.
The council heavily relies on central government funding, making the financial landscape clearer after Chancellor Rachel Reeves delivers her initial budget on October 30, followed by the Welsh Government outlining its spending priorities. With UK Labour’s focus on a claimed £22bn deficit in the country’s finances, tough decisions lie ahead. Carmarthenshire’s cabinet member for resources, Cllr Alun Lenny, highlighted the pressing need to find savings of £11.9m for the upcoming financial year. There is also ambiguity surrounding the funding of a 5.5% pay rise for teachers and the allocations for pension contributions.
Last year, Wales did not fully fund teacher pay rises, resulting in a £3m shortfall in Carmarthenshire alone. Cllr Lenny stressed the importance of the Welsh Government meeting these costs. The council is currently projecting department overspending of £17.9m for the present financial year, with schools accounting for a significant portion of this overspend. Looking towards 2025-26, the budget forecast assumes a 1% increase in Welsh Government funding and a 4% rise in council tax, pending final approval by the council early next year.
Cllr Lenny expressed concerns over the challenging budget timetable ahead, reiterating the council’s limited control over external financial factors. Plaid council leader Darren Price echoed these sentiments, highlighting the widespread apprehension among local authorities in Wales regarding funding gaps. Lobbying efforts are underway to ensure adequate funding from both the UK and Welsh Governments to address wage and price rises in the short and medium term.
The Welsh Government stated that local government funding had seen increases in recent years, with additional support provided where necessary. While challenges loom large for Carmarthenshire Council, the resilience and proactive approach taken by council members reflect a commitment to navigating through these turbulent financial times. As discussions and negotiations unfold, the council remains focused on prioritising essential services and financial sustainability in the face of ongoing budgetary pressures.