A DECISION to close a care home will reduce Rhondda Cynon Taf’s (RCT) budget gap for next year by just over £1m.
Updated budget proposals for 2025-26 going before cabinet on Wednesday, February 19, show that the decision to close Cae Glas care home in Hawthorn will shave £1.16m off the budget gap.
The provisional settlement from Welsh Government for Rhondda Cynon Taf amounts to an increase of 4.8%.
After taking this into account along with updated budget requirements, the council’s updated tax base, plus the already-agreed budget reduction measures of £10.28m, the council was faced with a remaining budget gap of £6.82m.
The plans being put forward to address this gap include a potential 4.5% increase in council tax.
This proposed increase would be 98p per week for a person living in a band A property and £1.47 per week for a person living in a band D property with 42% of properties in Rhondda Cynon Taf being band A.
Increasing council tax by 4.5% will reduce the remaining budget gap by £549,000, a cabinet report said.
The plan is for schools to be allocated funding next year to cover in full all their pressures, which will see an extra £2m allocated to the individual schools budget (ISB).
This will see the schools budget increase by £11.2m for next year, or 5.6%, and will be fully funded, the report said.
Resources for teachers’ pension costs have been allocated to schools and the ISB base budget requirement has been adjusted to reflect lower energy budget requirements.
The report also highlighted £500,000 of one-off funding which the council used to support the schools budget for 2024-25, ring-fenced for ongoing cost pressures associated with additional learning needs.
The report said the schools budget will increase from £198m to £212m, an overall increase of 7%.
Efficiency measures and budget cuts of £5.75m have been found including £3.75m in general efficiencies, £1m in capital charges and interest receivable, and £1m from service restructuring and vacancy management.
The report said officers have provided assurance the measures proposed can be delivered operationally and without a significant detrimental impact on frontline services.
A 5% standard rise in fees and charges is proposed with some areas seeing their own treatment and this will bring in £633,000 in income for the council.
These measures reduce the budget gap to £727,000 and the plan is to use funds from the transition funding reserve to cover this.
This would then leave £3.99m in this reserve but the report said processes are in place to ensure that savings are achieved in-year and this reserve can continue to be replenished.
It added: “It is also noted that whilst the settlement for 2025-26 is more favourable than anticipated the outlook beyond continues to look challenging.
“Accordingly it is recommended as being prudent to keep the use of this reserve to a minimum level in support of next year’s budget in order to protect the subsequent year’s budget strategy from having to address a more significant underlying budget shortfall.”
The overall council revenue budget for 2025-26 is set to be £668.12m.
At the meeting cabinet could decide to recommend these budget proposals to full council for approval.
