17.11.14
First two Welsh councils move closer to voluntary merger
Conwy and Denbighshire are moving closer to becoming the first Welsh councils to merge as part the Assembly’s plan of voluntary mergers, with the deadline for expressions of interest in the scheme approaching fast.
The two county councils are set to meet and vote on formally registering their interest in the merger with the government today. Their leaders and chief executives have met previously and the authorities have commissioned experts to produce a report on savings and costs.
If the measure goes ahead, a formal proposal will be submitted by the middle of next year.
However Denbighshire council have stressed that submitting the expression of interest does not commit them fully and that a number of “deal breakers” still remain.
One of the main sticking points is the difference in council tax between the two authorities, with Conwy paying significantly less than its neighbours.
The proposed options for dealing with the problem include Denbighshire reducing its level, for the Conwy tax to be raised to Denbighshire’s level, or for an average figure to be set.
If an average were agreed, however, Denbighshire would lose income, being forced into a “standstill” situation while the Conwy rate catches up.
A report by the Chartered Institute of Public Finance and Accountancy (CIPFA) states: “A further issue is that, at the moment, the legality of charging different council tax levels for different areas of a merged authority is untested but it might be possible for Welsh government to apply a form of transitional council tax relief to assist those households in Conwy that would otherwise face an increase in council tax purely as a consequence of merger.”
There are also worries about the financial assistance for the merger from the Welsh government, which is a major driver behind the deal. The proposals to be voted on state: “Both Conwy and Denbighshire are willing to progress a voluntary merger if, by doing so, they are provided with a strong financial incentive and/or support.”
The merger is expected to cost £5.5m and the councils are hoping that by being the first Welsh authorities to merge their status as “pathfinders” for other mergers will put them in a position to have it fully-funded by the Assembly.
The Welsh Government wants to shrink the number of councils from 22 to 12 as recommended by the Williams Commission on local government reform. As previously reported by PSE, minister for public services Leighton Andrews AM said that he wanted “local authorities themselves to make fundamental and lasting change to create modern and effective local government in Wales”.
However he added that there will be change, “voluntary or not”.
(Image: Denbighshire County Council Headquarters c. Arwel Parry)
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