Cash-strapped council’s £5.3m surplus
This is far cry from the £3.938 million deficit the council was predicting to post on its £341.6 million budget at the end of last September, and a massive improvement on the £894,000 surplus the council was predicting at the end of last December.
The huge turnaround that has been seen in the finances according to the report is down to the Welsh Government awarding the council £2 million on March 24 that lessens the impact of “spending pressures” in several parts of the council including Additional Learning Needs (ALN), Homelessness, Social Services and the Highways service.
The report which will be discussed at a meeting of the Finance Panel tomorrow (Wednesday) also notes that the council has spent £2.9 million from its risk budget on these areas and the school’s delegated budget during the year.
The risk budget is the council’s unofficial reserve that sits within the budget and is used to deal with emerging financial problems through the year.
The surplus can also be attributed to an increase in Council Tax and the report explains that the council collected £118.1 million from residents which is a £11.4 million increase on 2023/2024.
The report said: “Approximately £7.8 million of this is due to the annual increase with the remaining £3.6 million as a result of additional premium, recovery of arrears and any in-year growth in council tax base.”
Director of Corporate Services and s151 officer Jane Thomas said: “The revenue out-turn reported provides some opportunity to further mitigate the ongoing budget pressures through the next financial year.
“However, the council faces significant challenge as we develop our plans for future years. Our Medium-Term Financial Strategy (MTFS) continues to be extremely challenging with a significant budget gap over the next four years as the financial pressure we continue to face is likely to outweigh the funding available.”
The report now suggests that the council needs to plug a funding black hole of £39.1 million by the end 2029/2030 as a “best case scenario” when it had been £60 million.
Ms Thomas said: “The financial plans will be subject to. ongoing review, funding assumptions will be revisited as more information becomes available, revised budget gaps calculated and clear plans of how we can bridge the gaps will be developed.
Ms Mathias goes on to say that the plans that form part of the council’s “Sustainable Powys” vision is “fundamental to this”.
Without being a definable programme “Sustainable Powys” is what the council is calling its attempts to reduce and centralise services in five towns across the county: Brecon, Llandrindod Wells, Newtown, Welshpool and Ystradgynlais.
Ms Thomas said: “We must continue to take every opportunity to reduce costs and ensure the financial sustainability of the council.
“We must progress at pace to develop our plans to achieve a Sustainable Powys for the future.
“This is critical to ensure that the Council can remain financially stable and provide services for the residents of Powys in the long-term.”
The report will go on to be discussed by the Liberal Democrat/Labour cabinet later this month.
By Elgan Hearn, Local Democracy Reporter
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