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Newport council leader defends plan to increase council tax by 8.5%

Newport City Council's headquarters, the Civic Centre (Credit: LDRS)

THE LEADER of Newport City Council has urged residents facing a proposed 8.5% council tax increase to “look beyond the headline”.

The council is currently setting its budget for the next financial year.

A proposed 8.5% rise would be the equivalent of paying an extra £1.50-£2.01 for people in the “most common” council tax bands in Newport, leader Jane Mudd said at a cabinet meeting on Wednesday January 10.

She said the council was facing a funding gap of £3.8 million and had to make savings “to produce a balanced budget”.

That forecasted budget gap was “lower than this time last year” and in previous years, she noted, adding that energy costs had “significantly reduced”.

Newport, too, has received the highest increase (4.7%) of any council in its latest funding settlement from the Welsh Government.

Cllr Mudd said this reflected the city’s increase in population and the impact of the 2021 census data.

That 4.7% settlement would mean an extra £13.5m funding available to the council for the next financial year, she explained.

The proposal to increase council tax by 8.5% is not final, and could yet change. City residents can now take part in a consultation process on the council website.

When the council published its final budget plans this time last year, it brought down its council tax rise to 8.5%, from the initial 9.5% proposed.

Cllr Mudd said Newport’s council tax bills were “lower than nearly all other councils in Wales and the UK” and would “still be one of the lowest” even if they rose by 8.5%.

The local authority’s council tax reduction scheme, for people who claim Universal Credit or some other benefits, meant “households suffering financial challenges will not pay this increase”, she added.

As well as balancing the budget, the council tax rise will “protect” services which “benefit everyone”.

The council has also proposed budget savings, including closing some smaller libraries, cutting funding to the city’s pupil referral unit, and shutting the Civic Centre for up to two days a week.

Cllr Mudd said the “vast majority of these proposals will have no impact on service provision” and would not affect schools spending.

The council will spend an extra £3m on social care, £600,000 on homelessness support, and £400,000 on additional learning needs services, she added.

The leader warned of “unprecedented” demand on services, and said the medium-term outlook for council funding was “likely to be very challenging indeed”.

She called on the UK Government to “step up” and increase council funding to the Welsh Government, which at current levels “simply isn’t enough”.