MERTHYR Council has withdrawn or deferred some of its proposed budget cuts for next year.
A full council meeting on decided to withdraw proposals on household waste recycling centres and defer proposals for school transport, street cleansing and vehicle fleet management.
As part of planning the budget for 2021/2022, the council had identified savings of £1.04 million which result from the realignment of budgets, reviewing the borrowing strategy to fund capital projects, general operational savings, the receipt of additional grant income, increased income generation and “efficiency initiatives.”
Councillor Andrew Barry, the cabinet member for finance, said that the proposal for the household waste recycling centres (HWRCs) would be withdrawn.
The plan had been to close the HWRCs in Aberfan and Dowlais for one day per week on alternate days and close them during the summer months at 5 pm which would have saved £15,000 next year.
Councillor Darren Roberts, leader of the opposition Labour group, then proposed that they defer the proposal to remove school transport in Edwardsville which were estimated to save £36,000 next year.
Councillors Andrew Barry and John Thomas declared an interest in this item as they are involved in a school contract and so they left the meeting for this item.
He also proposed the deferral of the decision to remove 42/43 hour street cleansing contracts and replace with 37-hour contracts which were designed to save £53,000 next year.
And he proposed the deferral of a decision on whether to remove the fleet van from fleet management which was designed to save £2,000 next year.
These were all agreed to by full council which also approved the additional budget demands of £630,000 over the budgeted £3m.
In total, they are worth £4.9 million for 2021/22 with £1.277 million in additional demands relating to Covid-19 set to be funded by the Welsh Government through the continuation of the Hardship Fund.
The medium-term financial plan included £3 million of additional demands for 2021/22, leaving a further £623,000 needing to be accommodated within the budget for next year.
The council also approved a spend of £705,000 towards a capacity exercise.
It followed Welsh Government Advisers and Audit Wales questioning the council’s capacity to deliver services and its over-reliance on key individuals.
Senior Managers carried out the corporate capacity exercise which involved an assessment of the current resilience of council services in determining potential risks and investment requirements.
Full Council also agreed to a corporate vacancy factor increase of £150,000.
The corporate vacancy factor reflects the salary savings resulting from the natural delay between a post becoming vacant and subsequently being filled.
The council said it considers it “prudent” to increase this budget saving for 2021/22 from the originally budgeted £500,000 to £650,000 reflecting the projected outturn for 2020/21 and previous years.
And it agreed on the release of £350,000 from employee severance costs.
The original budget was £1.3 million for the cost of employee severances and this budget were to accommodate those early pension payments of employees who left the council during the last three years, predominantly through voluntary early retirement, together with any further new departures from the council.
Because of capacity issues faced by the council, there is currently less opportunity for employees to leave the employment of the council through voluntary early retirement or voluntary redundancy so the council said it is considered that the employee severance budget can be reduced by £350,000
The provisional Welsh Government settlement included a 4.64% for Merthyr Tydfil for the 2021/22 financial year which was the third-best settlement out of the 22 councils.
A provisional budget requirement of £133.78 million for 2021/22 is being proposed after considering a number of revisions to the original budgeted position.
No proposal has yet been made for council tax but the budget position at the moment is being modelled on last year’s 4.99% increase.
The initially projected budget gap for next year was £3.58 million but now thanks to the revenue settlement, social services grant and other factors mentioned above, the council now has a £394,000 budget surplus.
This may have to go on potential further commitments such as a schools budget increase resulting from updated information in respect of free school meals entitlement, council tax bad debt provision increase since council tax collection during the pandemic has reduced by around 2% and if the council tax increase is less than the budgeted 4.99%.
The final local government settlement is due to be announced on March 2 with the council expecting no significant changes.