5. How is the Welsh Government supporting local authorities in South Wales Central to maintain their statutory services? OQ58625

This year, the Welsh Government is providing unhypothecated revenue funding of over £5.1 billion, and over £1 billion in specific grant funding in support of local authority statutory and non-statutory services.

Thank you, Minister. I was referencing, in particular, the authorities within my region. 

One essential statutory provision is social services, and, specifically, care. We know that there are huge problems when it comes to recruiting carers. As a result, more and more individuals are becoming unpaid carers in order to look after their loved ones, and they face financial hardship as a result. Have there been any discussions with the Welsh Local Government Association in terms of extending the financial support for living costs to all unpaid carers, not just the 10 per cent who currently receive carers allowance? Furthermore, can more be done to promote the fact that it’s possible for unpaid carers to receive direct payments for providing care, even if they are living in the same household, if it is not possible to find alternative care? Many families are under the impression that this is not possible, but the truth is that local authorities have the right to allow this with appropriate evidence. So, have there been any discussions with the WLGA about this?

I know that the Minister for social services was at the recent meeting regarding budget pressures that local authority leaders were at, and they were able to have at least some starting of the discussions in terms of the specific concerns and pressures around social care. But I think the point that you make really does speak to the 'Claim what's yours' campaign that we're undertaking at the moment, because, as you say, there are plenty of people who are not aware that they're able to claim carers allowance. There are lots of people who aren't aware that they are able to claim direct payments, so it's important that we undertake as much work as we can to ensure that people are claiming everything to which they're entitled, especially at this difficult time. So, yes, we will absolutely redouble our efforts in that space.

Minister, as you're aware and has already been brought up by several Members in this Chamber, local authorities in Wales have vast usable reserves in their coffers. At the end of the 2020-21 financial year, this totalled over £2.1 billion, an increase of £600 million on the year before, with some local authorities, such as my own of Rhondda Cynon Taf, having just under £208 million in usable reserves. You will also be aware that the calculation for the amount that local authorities will receive from the revenue support grant assumes that there is no use of, or addition to, these financial reserves. This ultimately means, Minister, that local authorities are incentivised to keep increasing council tax rates year on year, and hoarding money without any financial impact on the RSG from the Welsh Government. This also means that council tax payers are hit hard year on year with higher and higher council tax bills, just so that councils can keep increasing their financial reserves. With this in mind, Minister, what assessment have you made of limiting the amount of usable reserves that a council can hold before the RSG is affected? And what impact assessment have you made of the detriment that households face when local authorities continue to increase their council tax rates when they have such substantial usable reserves? 

I'm not sure whether the Minister is able to hear. Were you able to hear that?

I heard the—

There was a lot of conversation going on on the same benches as the Member who was asking the question. Did you hear?

I did. I understood 90 per cent—

The Minister to respond.

—so I think we're okay.

You can answer the question. They're now falling out over who was having the conversation. [Laughter.] Minister. Minister.

Okay. So, to answer the question on reserves: I think it is a positive thing that local government has significant reserves when we move into a cost-of-living crisis. And let's remember, when we were discussing the budget last year, we were talking about that improved settlement in this first year of the three-year spending review, which gave local authorities over 9 per cent of an increase in their budget. But we talked, even at that time, when we had no real concept of the size of the cost-of-living crisis coming towards us, that years 2 and 3 of the spending review period were going to be difficult, so I think it's entirely right that local authorities now are looking to see how they can use their reserves in an appropriate way to help manage some of that particular pressure. I do think it is for local authorities to decide at what rate they set their council tax; it is a really important part of local democracy, and I think that we would only step in in extreme circumstances to tell local authorities what to do on council tax. I do believe it's an important tool that should be used on a local basis.