A GWENT council ended the last financial year with just under £1 million in spare cash after meeting all its spending commitments.
Torfaen Borough Council had a total budget for the 2022/23 financial year – which closed at the end of March – of £209 million.
A round up of its financial position was reported to the council’s Labour cabinet when it met, at the Civic Centre in Pontypool, on Tuesday, June 6.
Councillor Sue Morgan, the cabinet member for finance, told the meeting: “There was a small surplus of £975,000.”
That came after the council achieved 97 per cent of the £1.3 million of cuts and savings it had agreed when setting the budget in March 2022, and after it put money aside into its reserve funds.
It holds £33.8 million in reserves with a further £8.9 million in the school reserves, which was the only reserve fund to reduce in value in 2022/23 having stood at £11.8 million the previous year.
Schools had drawn on the fund through spending cash built up, due to additional Welsh Government funding in 2021/22, on extra staffing to help with the “catch up” following on from the Covid pandemic and on maintenance projects.
The council has £10.895 million in its general reserve – which can be used for various spending commitments – while its five service areas – communities and digital, resources, economy and environment, education plus social care and housing – hold a combined reserve of £5.742 millon.
The corporate reserve that is earmarked for 15 specific areas stands at £14.060 million and includes the £4.2 million the council has put aside for meeting increased energy costs this year, which it said it had agreed to do rather than making cuts to pay gas and electric bills which may subject to a temporary spike in prices.
Cllr Morgan said reserves had been built up due to the council’s “skilled officers” and the “disciplined” approach to finance that had been supported by councillors.
The Cwmbran Pontnewydd member said as a result the council had this year been able to set the lowest council tax increase in Wales, at 1.95 per cent, at a time of “rampant inflation”. Council tax contributed £49.5 million to the total budget in 2022/23.
Among the reasons for the council’s “positive” financial position were additional investment income from rising interest rates and “significant level of staff vacancies and staff turnover across all services” as well as extra grant funding, including from the Welsh Government.
Staff vacancies helped contribute to a £2.6 million “favourable variance” in the social care and housing service. Spending on placements for children in care still came in over budget, despite the number falling, as costs increased.
In education savings were made as schools were able to maintain budgets from the reserve so money anticipated for redundancies wasn’t spent and additional learning needs (ALN) out of county placements were lower than expected.
The education service had a £1 million “favourable variance” which would have been greater but for it having to spend an extra £156,000 on home to school transport costs due to rising fuel prices and additional demand for ALN pupils.
Cllr Morgan said though vacancies had resulted in savings areas in which it is “difficult to recruit and retain” would be a key spending area.
The council’s chief financial officer and deputy chief executive, Nigel Aurelius, said keeping a close eye on spending throughout the year meant elected leader Anthony Hunt could be confident in the financial position and use reserves to meet increased energy costs and maintain the planned 1.95 per cent council tax rise.
He said: “That allowed the leader, with confidence, to be interviewed outside the Civic Centre (on the Welsh news) during the budget round in contrast to other authorities.”
Mr Aurelius said Torfaen’s total reserves put it “still quite a way down the table” relative to other councils in Wales but said: “It is a good position for Torfaen”.
Panteg member Cllr Hunt praised the officers, and thanked councillors for their support and scrutiny, as well as the Welsh Government for “listening” and “making a difference”.
He said the council’s financial management had allowed it to maintain services and said: “You can’t run any services unless you have the money to pay for it.”