Elin Jones MS and Ben Lake MP call for further support
PLAID CYMRU politicians have slammed the latest budget settlement for Ceredigion, arguing that the Welsh Government’s funding formula unfairly penalises rural communities.
The county has received a funding increase of 3.6% for 2025/26, ranking 15th out of 22 local authorities in Wales. This represents the lowest increase per head of population in the country. By comparison, councils such as Newport and Cardiff received increases of 5.6% and 5.3% respectively.
The Welsh Government’s settlement has left Ceredigion County Council facing a budget shortfall of £7.4m to £7.5m, forcing it to consider cuts to services or significant council tax rises to balance the books. The council is currently modelling a potential 9.7% to 9.9% council tax increase to address the funding gap.
Elin Jones MS said: “This is a minuscule uplift for Ceredigion Council and will give the council very little flexibility to ease its budgetary pressures. By having a lower than average uplift from Welsh Government, the effect of this will be felt by important local services and the council taxpayers in Ceredigion. If the funding floor had matched the average increase of 4.3%, as had been hoped, then the pressure on services and taxpayers in Ceredigion would have been much eased.”
Ben Lake MP added: “It is disappointing once again that rural councils are being disproportionately underfunded by the Labour Welsh Government. There seems to be an inherent bias in the funding formula against rural areas and this needs to be investigated and rectified. Council taxpayers in rural areas are having to pay more than their fair share and this is increasingly unsustainable.”
Funding concerns and service pressures
The council’s budget report warns of continued financial difficulties, with cost pressures expected to reach £11.8m in the next financial year. These include a £4m burden due to National Insurance increases, £2.4m to cover pay rises for social care workers under the Real Living Wage policy, and an additional £2m for out-of-county children’s placements.
While a 10.5% increase in capital funding from the Welsh Government will provide an additional £612,000 for infrastructure projects, the council states that overall funding remains lower in real terms than it was 15 years ago.
Ceredigion has also suffered a significant cut in its allocation from the UK Shared Prosperity Fund, which has been slashed by 43% from £8.8m to £5m. The council warns this will impact local economic development projects.
Calls for a fairer funding model
Both local Plaid Cymru politicians and Ceredigion County Council leaders are urging the Welsh Government to implement a funding floor of at least 4.3% in the final budget settlement. The council argues that the current system disadvantages rural areas like Ceredigion, where service delivery costs are higher due to a sparse population and greater travel distances.
The council’s financial resilience report warns that without changes to the funding formula, future budgets will remain unsustainable, with increasing pressure on council taxpayers to make up for shortfalls.
Elin Jones MS and Ben Lake MP have vowed to continue lobbying for a fairer deal for Ceredigion, highlighting the disproportionate burden placed on rural communities compared to urban areas.
