A COUNCIL awarded the lowest funding increase in Wales is hopeful of securing additional money – with its draft budget containing a near £3m black hole.

Monmouthshire County Council has proposed a council tax increase of 7.8 per cent and set out cuts and changes to services totaling £5.1 million but that still leaves it short by £2.86m of achieving the £8m savings needed to produce the legally required balanced budget.

Ben Callard, the councillor responsible for finance, said talks are ongoing with the Welsh Government about a ‘funding floor’ that would raise increases from Cardiff Bay to a minimum level across Wales.

As the council is hopeful of securing some extra money it has avoided setting out further cuts which it doesn’t believe will have to be made.

Monmouthshire’s allocation under the local government funding settlement only increased by 2.6 per cent (or 2.8 per cent when previously separate grants are included) way below the 4.3 per cent average though it still provides an extra £5.1m and the council tax increase adds another £5.9m. Without any increase in funding Momouthshire would be £23m short of what is required to maintain services at their current levels and meet expected demand.

“We have been having very constructive dialogue with the Welsh Government and because of that constructive dialogue, we are anticipating a floor being put in place,” said the Labour councillor.

“But at the moment we don’t know at what level that floor will be. So there’s a gap in the budget, which demonstrates that we need that additional funding.”

It isn’t anticipated the shortfall in the draft budget will be met in full with Cllr Callard cautioning: “I think for that for that entire funding gap to be closed, we would need to get a particularly high floor.”

The council will be inviting the public to comment on the plans with a formal consultation, from Thursday, January 23 to February 22.

During that period the spending plans will also be scrutinised by council committees who will question the savings, how achievable they are and the Labour and Green Party cabinet’s spending priorities in a budget worth £216m.

Spending includes an extra £7m for the education and economy budget, a £10.7m increase on last year’s £65m allocation, and £7.2m more for social care and health, a rise of 10.6 per cent for a department where costs have consistently been above its existing £68m budget.

The services are still required to make savings however as the extra funding still doesn’t meet expected cost increases and the budget also seeks to meet around £5.8m in extra costs, mainly due to demand for social care and children’s additional learning needs as well as transport bills, that have pushed in year spending over budget.

However Cllr Callard said he is now “optimistic” the council will finish the current financial year with a balanced budget without using reserves.

Extra funding is intended to ease pressures on schools but Cllr Callard acknowledged social services still pose a challenge. Savings to social services include staffing reductions with many posts left unfilled, and an increase in charges some adults must pay, though those are capped at £100 a week by the Welsh Government.

“Putting an extra £1m into our schools I am hopeful that that will go a long way. A few of them have slipped into deficit budgets and we’re looking to support our schools with that additional funding. I think it’ll be welcome,” said Cllr Callard.

“Health and social care I guess it’s a two-sided coin. Although the funding is going up, I think, to £75 million, and is outstripping education, which is quite a new trend in local government to have education as no longer the single biggest area of spending, it’s been outstripped by social care, that’s responding to the demand on the services.

“But we are also seeking savings within that directorate. So we’re putting a lot more money into it, but we’re also asking it to become a more efficient service.”

The council says all services it currently provides such as leisure centres, libraries and waste collections will still be provided from April though it is making changes such as reducing opening hours of community hubs which will also mean libraries opening hours reduce, though there will be a consultation.

The council tax increase will see a band D property pay £1,818.26 from April, before extra charges for police and community councils are added, and Cllr Callard defended the rise.

“You have to look at both sides of the coin with this and you have to say, if you want to have a very low council tax increase, what services are you prepared to sacrifice in order to achieve that?”

Cllr Callard said he acknowledged residents are being asked for an above inflation increase but said that is driven by demand on services: “We will be challenged on 7.8 per when inflation is at 2.5 per cent. I think it’s a valid criticism.”