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Merthyr Tydfil Politics South Wales

Merthyr Tydfil Council facing ‘unprecedented measures’ to balance budget

IT’S going to take “unprecedented measures” to balance Merthyr Tydfil Council’s budget this year, a councillor has said.

A report which went to full council on Wednesday, January 17, said the budget gap of more than £13m for next year was the highest in recent years and savings would “inevitably” impact on staff and services.

The provisional Welsh local government settlement in December resulted in a funding increase of 3.4% for Merthyr Tydfil for 2024-25, the fifth best in Wales and above the average 3.1% rise. However the council said that, despite this, they still had a gap of £13m in the budget

Councillor Andrew Barry, independent, the council’s deputy leader and cabinet member with responsibility for finance, highlighted the Welsh Government’s spend on the 20mph speed limit, the return of capital monies to the treasury, the plan for extra members of the Senedd and abandoning the M4 relief road.

He said: “Passing the buck down the M4 is no longer an option” adding that the Welsh Government could use the levers it held to improve people’s lives and grow the economy.

He said that with council tax “nothing is off the table at the moment” and that they didn’t have the luxury to “pick and choose” decisions.

Cllr Barry said it was going to take “unprecedented measures” for them to balance the budget.

He said every 1% in council tax had an impact worth about £280,000 which was not going to solve the problem as a 4% rise would raise just over £1m.

He said they had to look at “every option” and not just business cases, but a fundamental review of how the organisation operated.

Cllr Barry said: “It is not palatable but that is where we find ourselves.”

The council’s director of finance, Liam Hull, said they would always try to protect the most vulnerable and young people but the size and scale of the challenge was unprecedented so no area was completely safeguarded.

Cllr Barry added that council tax was part of the budget requirement and that there were many other parts to the equation, adding that he and Cllr Declan Sammon had lobbied continuously over council tax as it was “grossly unfair.”

He said savings they had to make would continue through the period of the medium term financial plan and they had to look at continually changing their approach.

Cllr Barry said business cases were brought by officers and the administration would take out what they thought was unacceptable.

He said the equation had “many more moving parts” and “we are where we are.”

He said they would make the difficult decisions and they’d got no choice as they had to balance the budget for the residents of the town.

The need to be more proactive in budget setting

Councillor Brent Carter, Labour, said: “We are living in deeply troubling times. We are entering probably the toughest period in my 15 years as a councillor” and said that more transparency was vital.

He asked why they’d been so late again with the process and said “we need to be more proactive here.”

He said they should be having options available so that they could add or take away things from April last year.

He said: “It’s easier to remove things rather than rushing to add things at the last minute.”

He said: “We are all in this together. Why wasn’t that the case for the last seven years?”

The leader urges co-operation

The leader of the council, Councillor Geraint Thomas, independent, said the door was always open on council tax.

He said they’d had a workshop where all councillors had the opportunity to see what savings were being put forward by officers and that councillors knew every budget through the medium term financial plan.

“All the information is there if you want to set your own budget,” he told the Labour group.

“We are in difficult times. Very very difficult times. We’ve never had a budget gap like this. There are going to be casualties along the way. We are going to lose staff.”

He said that they “all have to work together to get a legal balanced budget over the line.”

“We all have to play the game. All of us. Because if we don’t the council falls down.”

Criticism of the Barnett Formula

Councillor Clive Jones, Labour, said it didn’t surprise the Labour group that Councillor Andrew Barry used every opportunity to have a go at the Labour Welsh Government but said he was “missing one part of this equation and that is the UK Government.”

He said everyone accepted that the Barnett Formula was completely outdated and until it was renegotiated and places like Merthyr Tydfil had a piece of the cake that they required because of factors like deprivation then they were always going to have problems.

He asked if Cllr Barry accepted that the fault for the financial situation of all councils lay with UK Government and Cllr Barry said of course but that there was “no denying it is Welsh Government as well.”

Cllr Barry said how the Welsh Government decided to spend its money was a Welsh Government decision.

He said the parties were elected to look after the people of the country but it was “an abject failure on both counts” adding “it is the Tories but it is also Labour.”

The importance of working together

Cllr Mytton said she fully supported co-operation and she was sure facts and figures would be available for the Labour group to work co-operatively and come up with further ideas and solutions.

She said the Barnett Formula was “outdated” and should be scrapped immediately as it didn’t support financial planning.

She said the UK Government budget cuts had been “crazy” but the Welsh Government had been in place for 25 years and the 2024/2025 budget had been “ripped apart” with cuts proposed to the apprenticeship budget.

She said Welsh Government was the decision maker and had got the pack of cards adding that money had been “mismanaged” by Welsh Government.

She said: “I am all for working together” and said “I don’t believe in politics in local government.”

Cllr Mytton said questions needed to be asked about the “diabolical spend” on the 20mph speed limit which she said should’ve been redirected to vital services.

Timescales

Leader of the opposition Labour group, Councillor Darren Roberts, said they had their settlement at the same time as other councils but other councils were “ahead of the game” and had already done work to try to deal with their budget gaps.

He said: “We’ve known for some time that it was going to be a big challenge this year. If some tough decisions had been made last year we probably wouldn’t be in a position where we are now.”

He said they’d love to put forward an alternative budget but until they knew about all the service cuts, had workshops and seen what was ahead of them they couldn’t possibly comment on that.

Council tax

Cllr Anna Williams-Price of Labour said it was a “mistake to dismiss council tax” as a small part of the income of the council.

She said that people were making adjustments to their own personal budgets in time which was undoubtedly really hard for people.

She said it was “really important” for residents to have as much information about any council tax increase as far in advance as possible to allow people to plan.

Councillor Declan Sammon, independent, said that as mayor last year he wrote to the MP and local members of the Senedd asking for council tax to be made fairer and for more funding.

He said Merthyr Tydfil had been in the top three for council tax in Wales and that “neither Labour or the Conservatives do anything for the residents of Merthyr Tydfil.”

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