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21.12.16

Welsh local government settlement ‘better’ than councils expected

The Welsh government has been given a “good” finance settlement from Westminster for 2017-18, better than many councils expected, the Welsh finance and local government secretary Mark Drakeford has confirmed.

However, Drakeford again urged Welsh councils to use the next fifteen months to “think carefully” in preparing for the 2018-19 financial year which will bring added pressures for local authorities.

The final local government settlement agreed with Wales for 2017-18 includes £4.1bn of revenue funding, an increase of £10m compared to this year, and £433m of capital funding, including £143m of general capital funding which will allow councils to continue developing infrastructure.

“I am confident the settlement provides councils with a robust basis for their financial planning for the coming financial year,” Drakeford said.

“This is a good settlement for local government, particularly given the many competing pressures on the Welsh Budget. It’s fair to say that the provisional settlement was much better than most in local government were expecting.”

Other formal announcements included the setting of a 0.5% funding reduction floor, softening the blow on councils who would have seen the biggest reductions in core funding, and an extra £10m for non-domestic rates relief which will be delivered through local authorities.

Drakeford also announced a £6m funding boost to help tackle homelessness which will go directly into local authorities’ revenue support grant so they can decide how to use the funding.  He said the decision would give local authorities “the means and flexibility” to help tackle homelessness.

“I’m very pleased to be able to announce this extra funding for homelessness prevention. We have been listening to our partners in both the charity and housing sectors and this extra £6 million will give local authorities both the means and flexibility to help tackle the issue effectively,” Drakeford added.

Homelessness is a key issue that councils are considering this winter. In the last week London mayor Sadiq Khan announced plans for an extra £50m ‘move-on’ fund to provide two-year tenancies to homeless people ready for independent living, and the Greater Manchester Combined Authority stated its intention to pursue an integrated approach to tackling homelessness in Manchester.

The Welsh communities secretary Carl Sargeant praised the announcement of the additional £6m funding, saying that it would help local authorities continue their work in addressing homelessness.

“This extra funding will help local authorities to build on the very positive start they have made in implementing the legislation we introduced last year to help everyone who is homeless or at risk of becoming homeless,” Sargeant said.

“Preventing homelessness helps to protect people’s health and wellbeing which can in turn help to reduce the demand on services such the NHS.”

Cllr Anthony Hunt, WLGA deputy finance spokesperson, added that the association welcomed the final settlement for local government, especially its additional £10m resource for social care. 

“I hope that along with other measures this starts to address the £92m shortfall that is faced by social services across Wales,” he stated. “The announcement today will still mean that cuts to local public services will continue as we shoulder the heaviest burden under austerity. 

“All councils across Wales are planning for service pressures beyond 2017-18 and up to the end of the end of decade. In this setting we welcome the ongoing dialogue with the cabinet secretary Mark Drakeford AM and the open, constructive approach that he takes.  We share his views on the flexibility that we have in Wales relative to our counterparts in England.”

(Image c. Ben Birchall PA Wire)

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