8. Debate: The Local Government Settlement 2020-2021

Part of the debate – in the Senedd at 5:17 pm on 3 March 2020.

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Photo of Mark Isherwood Mark Isherwood Conservative 5:17, 3 March 2020

Under the Welsh Government's local government funding formula, nine out of 22 Welsh local authorities received an increase in the current financial year. The Welsh Government tells us that its formula is heavily influenced by deprivation indicators. Alongside Flintshire, the councils with the largest cuts this year of 0.3 per cent included Conwy and Anglesey—well, they're amongst the five local authorities in Wales where almost a third or 30 per cent or more of workers are paid less than the voluntary living wage. Prosperity levels per head in Anglesey are the lowest in Wales—just under half those in Cardiff—and Conwy has the highest proportion of older people in Wales, yet council tax payers in Anglesey and Conwy face 9.1 per cent increases. Wrexham was also cut, despite having three of the four wards with the highest poverty rates in Wales.

Council tax payers in Flintshire faced an 8.1 per cent increase, despite Flintshire councillors having launched a campaign, #BackTheAsk, which highlighted cross-party frustration about the funding they receive from the Welsh Labour Government. The campaign specifically asked for a fair share of funds from Welsh Government, highlighting that Flintshire was one of the lowest funded councils per head of population. This had been unanimously agreed by all parties on the council—a Labour-led council.

Under the final Welsh local government settlement for 2020-21, four of the five bottom local authorities in terms of funding increases are again the same authorities in north Wales, Conwy, Wrexham, Flintshire and Anglesey, whilst Monmouthshire remains bottom. Whilst the Labour Welsh Government denies that it has any intention to create a north-south divide, it is still perhaps convenient for it that, under its 20-year-old local government funding formula, four of the five authorities to see the largest increases in 2020-21 are again Labour-run councils in south Wales.

Although the local government Minister states that the biggest impact on distribution of the settlement across authorities derives from the relative change of overall population and school-age populations across each local authority area, an analysis of the latest published official statistics for each does not paint a clear picture in this respect for either. The local government Minister also states that the division of the local government settlement between local authorities is done by the democratic processes of the Welsh Local Government Association. However, as senior councillors in north Wales have told me, cross-party, the losers do not want to openly challenge the funding formula on the basis that in order to gain, other councils would have to receive less. Therefore, in a 'turkeys don't vote for Christmas' attitude, they would not receive any external support.

Nonetheless, a letter signed by every council leader in north Wales was sent to the leader of the Welsh Local Government Association, stating that the benefits of this settlement are not shared sufficiently fairly and leave most of the councils in the north with a settlement significantly below the net cost of pressures, inflation and demographic change. They also wrote to this local government Minister, asking her for a funding floor of 4 per cent in the local government finance settlement in light of continued challenges for the 2020-21 financial year. As they said to the Minister, four of the five bottom councils are from north Wales and without a floor, most north Wales councils will be faced with the biggest challenge in terms of seeking cuts to services. They added that a floor would help to protect services and work against the above-inflation council tax rises in the bottom six councils, including Blaenau Gwent.

Despite this clear cross-party statement, the Minister has dismissed their official representation and rejected a funding floor in the final settlement. As one of these leaders told me, 'It's clear to me that there continues to be very little understanding of the pressures and increased demands that local government is faced with, and a conveniently short memory from her Government's 2016 manifesto commitment stating that they would provide funding to put in place a floor for future local government settlements.' They added that it's also disappointing that the Minister has not decided to bridge the north-south divide, as four of the bottom five councils in the funding settlement will be in north Wales.

As a worried Flintshire resident who rang me last week here stated, 'We can't cope if our council tax goes up by around another 5 per cent after 27 per cent over the last four years. This used to be a Labour area, but they aren't listening.' Diolch yn fawr.