A COUNCIL official said difficult decisions will need to be taken in Cardiff to help the local authority deal with a “frightening” budget gap.
Cardiff Council’s corporate director of resources, Chris Lee, addressed members of the council’s governance and audit committee as they discussed a report showing the main pressures on the authority’s finances.
The council’s projected overspend at July 2023 was £6.5m according to the report presented to the committee at the meeting on Tuesday October 24.
As it stands, the council is currently facing the prospect of a £36m budget gap for next year and a predicted shortfall of £119m over the next four years.
An independent member of the governance and audit committee, Chris Burns, who called the £119m quoted in the council’s report a “frightening sum” asked Mr Lee for an update on the council’s plan to save enough money for the coming year.
He said: “It is a pretty colossal task.”
Mr Lee said work will be taking place over the autumn to see where the council can make savings.
He said: “That work has got to take absolute priority… we are across all services looking at all options.”
There are a number of ways the council can look to make savings for next year, including making efficiencies savings to the services it delivers and boosting income through increased fees and charges.
Another option would be making cuts to certain services.
Mr Lee said: “[There is a] huge amount of work that we are doing currently.”
In the report presented to members of the governance and audit committee, the biggest pressure area is children’s services, with a projected overspend of £2.9M at July 2023.
The £36m funding gap is based on the assumption that Cardiff Council could receive funding of £16m from the Welsh Government, however the amount that the local authority will actually end up receiving won’t be confirmed until December.
There are also a number of other factors which could have an impact on the budget gap for next year, like pay awards.
When asked by Cllr Joel Williams how much the council has budgeted for pay awards, Mr Lee said: “The current year pay award assumption is an overall increase of 5%.
“I say deliberately overall because we have mirrored the pay award settlement that was given in the previous year, where there was an absolute amount given which I think was £1,920, which meant that those on lower bandings had a higher percentage and obviously that changed as you went up the banding level, but it gave an overall increase of around that total.
“If that was agreed at the same level, then that is budgeted for.
“Anything over and above that, because clearly we are still in dispute in relation to the level of that pay award generally, that would create a risk.”
An update on the council’s revenue position will be brought before Cardiff Council’s cabinet members in November.