3. What assessment has the Welsh Government made of the sufficiency of this year's local government settlement? OQ57010

In the current financial year, we provided local government with a 3.8 per cent increase in their core budget, building on the significant increase we provided in 2020-21. In addition, we have made over £325 million available through the local government hardship fund to help local government to respond to the pandemic.

Thank you, Minister. Earlier this year, Welsh Government also provided an additional £40 million in resources to support social services specifically in 2021-22 through the social care recovery fund. Through this, RCT council has made the decision to extend the real living wage to all contracted adult social care workers and personal assistants from December onwards, which of course is very welcome news. Given that Welsh Government has committed to paying care workers the real living wage as part of your programme for government, will councils in the future receive the additional finance to deliver this annually as part of their annual settlement?

Thank you for recognising the important work that RCT have been doing in terms of investing in their staff to retain and value them. I think that's been really important, and an excellent intervention on their behalf. The Welsh Government is currently working with partners to better understand the full implications of our move towards ensuring that all staff in the social care sector are paid the real living wage, and in doing so, to better understand the ways in which we can ensure that it is the staff who benefit from the uplift that is provided.

The £42 million that you referred to for social services I know has been welcomed by local government, but I've had some good discussions with them recently where they've been very, very clear with me that additional funding this year will still be required. So, I've been working with local government and with the Minister for Health and Social Services to identify a figure for that to ensure that we're able to respond to that as soon as possible. We'll do that through the COVID reserve and I hope that either I or the Minister for Health and Social Services will be saying more on that very, very shortly.

Thanks to my colleague for raising this important issue in the Chamber today around local government settlements. Minister, there does seem to be a significant differentiation at times between what council leaders and locally-elected members are saying is the funding needed through the funding formula to deliver many of the important services against what you seem willing to support at times. An example of one of the areas that I know will have been raised with you is the ability of rural authorities to deliver services across, at times, vast areas of geography, and how the current funding formula manages to reflect this. Of course, this isn't anything new. It seems to be a regular battle that local authorities have with Welsh Government in terms of the funding formula because, of course, it does represent around 70 per cent of a council's ability to spend on and deliver those services. So, my question is: in working with the Welsh Local Government Association, what consideration would you give to commissioning an independent review of the funding formula for local councils? 

Thank you for raising the question, and I also have discussions with local government in terms of the funding needed. But I have to say, it's not a question of what I'm willing to support; it's what I'm able to support as a result of the Welsh Government budget that we're provided with by the UK Government. So, clearly, I would want to do more for local government, but we were able last year to fund their identified workforce pressures in full, and that was a significant pressure so I was pleased that we were able to do that. And the past two settlements for local government have been the best offered for over 12 years. 

In our budget discussions ahead of the summer, we agreed as a Cabinet that health and social care would continue to be our priority, and also we would seek to give local government the best possible settlement. So, I have a meeting with the finance sub-group, which includes local government leaders and others—their finance spokespeople, I should say—next week, where I'll be hearing directly from them what their pressures are for next year.

In terms of a funding formula review, I've been really clear with local government that if they want that funding formula reviewed and come to me with their request for that, I'm more than happy to instigate that review and have further discussions about that with them. That request hasn't come forward yet, but if it does I'd be very, very happy to have those discussions.