Newport City Council will see a reduction in funding of 1.7 per cent next year.
Draft figures from the Welsh Assembly Government detailing how much financial support the council will receive in 2011/12 were released yesterday. Newport is one of fourteen Welsh councils which will receive the highest reduction.
Councillor Matthew Evans, leader of the council, said: “We expected a considerable reduction in our Welsh Assembly Grant and have worked hard to ensure we are in a position to deal with the cuts in the best way possible.
“There is no doubt that the decisions we will have to make will be very tough but this needs to be tackled head on.
“This time last year we began a series of council-wide reviews and improvements. We recognised that planning ahead was vitally important so that we can continue to serve our residents and provide quality services.
“And we will not stop there – the council is looking at long term budgets and how we can prepare for future years. Our current predictions show continuing budget shortfalls over the next four years which will mean ongoing changes to the way we work.”
In addition to the draft settlement, there is still information outstanding in terms potential cuts to the specific grants the council receives, which are not visible on the face of the budget announcement.
As well as a significant cut in funding, the council also continues to face increasing demand for services and the rising cost of existing services due to inflation. Pressure on local services is higher than ever and this will continue with the ongoing effects of the downturn and reductions in public spending in other key areas.
Councillor Ed Townsend, deputy leader, added: “Managing increased demand for services with less money is the biggest challenge facing the council. Significant budget savings will have to be found and this will make it extremely difficult to maintain services.
“We will tackle this by improving efficiency but it is clear that reducing the budget by this extent will have an effect on all our services.
“When looking at our capital budget, we are very concerned about the impact of the funding cuts. For over two years, the council has been managing on a very limited capital programme of investment in its buildings and infrastructure and these cuts will make significant investment very difficult for a number of years to come.”
Further detailed financial planning will now be carried out and Overview and scrutiny forums will consider the implications for service areas.
Full Council will consider a full budget and proposed council tax figures in February 2011, taking into consideration the need to maintain service provision, coupled with achieving a balance between efficiency savings and any possible council tax increase.
