Council warns it needs to find at least £6m savings in budget – but the figure could be over £20m

Carmarthenshire Council say the rising cost of inflation, food and energy prices along with increased global demands for goods and services, means it is facing a significant shortfall in its 2023/24 budget. 

Just as the cost-of-living crisis is placing enormous financial strains on households and businesses across the county and beyond, the Council and other local governments across Wales are also facing similar pressures.  

This, together with legacy costs from the COVID-19 pandemic and much higher pay offers than anticipated when this year’s budget was set, is adding even further burden on the its budget, the council has warned.

A report which goes before the council’s Cabinet on Monday, October 3, warns that the money that has been allocated so far to the council by the UK and Welsh Governments falls far short of what is required by the Council. 

The council is warning that, based on current forecasts, there are some incredibly tough decisions ahead with the potential for reduction in some services and will be inviting residents to have their say on how we balance the budget. 

Councillors and Officers say they will work together over the coming months to develop proposals to meet the best-case savings needed of £6.1 million. This is more than 50% higher than previously expected. 

They will also explore options to identify additional areas for further savings, should these be required. Estimates suggest that the figure could be over £20m. 

Speaking ahead of Monday’s Cabinet meeting, Cabinet Member for Resources Cllr Alun Lenny said: “These are difficult times for everybody, and it’s crucial that we support each other through this period of economic hardship. As Cabinet members, we will be upfront with the public from the very start as we face the very difficult, but essential, decisions to achieve, at best, savings of £6.1 million to our budget.  

“Most people will have an opinion as to what services they think should be ringfenced and what services we might consider scaling back, as we strive to make the necessary savings to the council’s budget. We want to have a conversation with the people of Carmarthenshire when the Cabinet discusses recommendations to identify money-saving areas. 

“Decisions will not be made lightly. The authority’s current medium term financial plan was approved by full council earlier this year and was based on estimates of known commitments at that time. It was also based on Welsh Government’s financial settlement and forward indictors.

“The council anticipated that inflation would be 4% – a very prudent prediction. No-one could have foreseen an inflation rate of 10%, with its inevitable impact on pay settlements, energy costs and sustained cost of living pressures.  

“Against this backdrop, and unless public spending plans are radically updated by the UK and Welsh Governments, the council has to begin the process of identifying the required savings to ensure that we meet the looming financial pressures ahead.” 

Following the Cabinet meeting, the council say they will look to engage and consult with its residents. 

(Lead image: Geograph)