Agenda item

To recommend to the Council (at its meeting on 5 March 2026) that:

 

1.  A budget of £379,701,110 should be set for 2026/27, to be funded by £264,009,390 of Government Grant and £115,691,720 of Council Tax income (which is a base increase of 4.75% plus a further 0.42% to meet the levy from the Fire Authority, which gives a total of 5.17%).

 

2.  To establish a capital programme of £40,179,430 in 2026/27 to be funded from the sources set out in Appendix 4 of the report.

The report was presented by Cllr Huw Wyn Jones.

 

DECISION

 

To recommend to the Council (at its meeting on 5 March 2026) that:

 

1.  A budget of £379,701,110 should be set for 2026/27, to be funded by £264,009,390 of Government Grant and £115,691,720 of Council Tax income (which is a base increase of 4.75% plus a further 0.42% to meet the levy from the Fire Authority, which gives a total of 5.17%).

 

2.  A capital programme of £40,179,430 in 2026/27 should be established, to be funded from the sources set out in Appendix 4 of the report.

 

 

 

DISCUSSION

 

The report was presented noting the financial forecasts from the current financial year. It was noted that there was approximately a £5.3 million overspend across the Council, where departments' budgets did not meet the demand for service.

 

Reference was made to the increase in the settlement received by the Council from the Welsh Government to 4.1%. It was noted that despite being a better increase than expected, it was still amongst the lowest in Wales.

As part of the budget setting process, a possible salary increase of 4% for teachers, and 3.4% for all other Council staff was anticipated.

 

An overview was provided of the revenue bids for next year, and the cross-section for every department.   

 

⁠It was seen that there was the usual increase in levies, including £458,000 ⁠

to the Fire Authority, and then smaller amounts to Natural Resources Wales, Eryri National Park and the North Wales Corporate Joint Committee.

It was estimated that an additional £23.3 million would need to be spent in the next financial year to maintain the Council's services. Salary inflation, general inflation and the increased demand for services were highlighted as being the main pressures.

 

Spending requirements for the 2026/27 financial year were confirmed to be around £380 million. It was highlighted that the settlement from the Welsh Government was approximately £264 million, leaving a void in excess of £116 million to be covered by Council Tax and savings.

 

It was noted that a total of £644k in savings had already been approved for the 2026/27 Budget - with around a quarter of a million pounds of these savings being available to cover the funding gap during the next financial year.

 

Since the report was published, attention was drawn to the fact that the Council had received confirmation that it would receive a subsidy towards its contribution to the Fire Authority costs, which was approximately an additional £50,000. It was revealed that the Council had also seized the opportunity to repay a capital loan very recently, which decreased the annual amount that needed to be earmarked for paying off these loans.

It was noted that this allowed for the increase in Council Tax for next year to be lowered from 4.9%, as noted in the report, to 4.75%. It was added that the fire element would be additional to this.

 

Observations arising from the discussion:

·       An observation was made regarding the obstacles that a year-by-year budget created for councils, asking once again for a multi-year budget from the Government to enable forward planning. 

·       Members were glad that additional money had been budgeted to support Special Schools and Additional Learning Needs services within mainstream schools. It was pointed out that this merely touched the sides, and that a national investment in this area was needed.

·       Further details were sought about the repayment of a loan. In response, it was disclosed that an opportunity had arisen for early repayment without incurring extra charges. It was confirmed that the Council had accepted, and that the early repayment meant savings for the Council. It was added that this did not happen often. 

·       Support was declared in the investment in the Council's buildings, including schools and homes for the elderly, following years of austerity.

·       The permanent bids that go towards the overall lack of budget was welcomed, which showed that the Council was eager to do right by the County's residents by meeting the increased demand for services.

·       It was appreciated that any Council Tax increase would have an impact on the County's people. Support was said to be available, and that the information could be found on the Council's website or by contacting Galw Gwynedd.