COUNCIL tax is likely to rise in Swansea to ensure more money for schools and social services, despite a rare financial windfall from central Government.
Swansea Council will receive £17 million more from the Welsh Government in 2020-21 than the current year, if AMs pass the draft budget for Wales in the coming weeks.
This increase for Swansea has been described by council leader Rob Stewart as “very welcome” but not enough to offset “years of UK Government austerity”.
And it means council tax payers, whose bill rose by 5.99% this year, will have to pay more again from April 1.
Swansea’s cabinet will discuss a draft budget report at a meeting on January 9 which indicates “substantial additional investment” in education, social services and place, which covers waste collection, roads and housing.
But, due to rising demand for services and increases in employee pay and pension costs, the report warned that there will still be a funding gap of £18.3 million.
This gap is also due to the removal of previously agreed savings plans which could not be delivered.
The £18.3 million shortfall is to be partially met by departments cutting costs and generating extra income. But council tax payers will also need to pay more, although a final figure is not known at this stage.
Cllr Stewart said the figure would only emerge after further discussions and a public consultation.
The average Band D council tax charge in Swansea is currently £1,602.21.
New council tax premiums will come into force on April 1 for second home owners and owners of long-term empty homes in Swansea, which should help buffer the rise for other council tax payers.
Cllr Stewart said: “All things being equal I think we could be looking at setting a council tax level lower than this year, depending on all the money flowing from the (central Government) settlement.
“It’s a very simple situation that the more cash that comes from the UK Government the less the local taxpayer has to find.”
The budget report also said 38 council posts are considered to be at risk in 2020-21, compared to 161 in the current financial year.
The authority will try to redeploy affected staff rather than going down the compulsory redundancy route.
As well as setting the budget for 2020-21 in the coming weeks, the council will also publish a new medium term financial plan.
Cllr Stewart said: “It will take a few more years of better funding to undo the damage of austerity cuts.”
Opposition leader, Cllr Chris Holley, said he felt any council tax rise above inflation – currently just below 2% – will “be difficult for the public to absorb this time round”.
The Liberal Democrat councillor agreed the central Government settlement was better than recent years, but he said it still hadn’t returned to the equivalent levels of 2012 and before.
Cllr Holley said Swansea’s roads and pavements needed investment.
He also felt that no more money which could be spent on services should be put aside to finance borrowing costs for Swansea Bay City Region city deal schemes.
The Labour-run council has set aside money in this way to smooth out borrowing costs for the new indoor arena.
“We would not like to see that happening again,” said Cllr Holley.
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