Here's your Friday update, covering: the council's updated budget forecast; the latest Cardiff Council performance report; new rights for tenants; and action to keep leisure centres open.
Cardiff Council's stark budget warning
A stark financial warning has been issued by Cardiff Council which says spiralling inflation, increased demand and lower than anticipated income levels, has left it with a £53m hole in its budget for 2023/24.
The potential increase in costs to deliver services like education, social care and waste services is the highest ever seen in a single year by the local authority.
The pace and volatility of economic factors is such that its budget gap for 2023/24 has almost doubled, meaning the council will now have to find £53m in savings and income generation next year instead of the £29m it was anticipating in July.
The warning comes in an emergency budget update report which will be presented to the Council's Cabinet when it meets next Thursday, 20th October.
Cabinet Member for Finance, Modernisation & Performance, Cllr Chris Weaver, said: "This is a crisis that the entire public sector across the UK is facing. The First Minister has warned that "thousands and thousands" of jobs could be cut from public services if the UK Government imposes large cuts on the Welsh budget. Unless there is a recognition by the UK Government of the scale of the price increases we face, councils across Wales and the UK will be forced to cut local services and jobs. After a decade of austerity and with the growing pressure on family budgets, this is deeply worrying.
"Over the past ten years this council has already made around £250m in savings. We've managed to do this while maintaining services, but the massive increase in costs and demand for our services, which has grown through the pandemic, will leave us facing some very tough decisions. We will need to review everything we do."
Most of the council's current £744m annual budget - around two thirds - goes on paying for schools and social services.
A budget gap is calculated by comparing predicted funding (the grants the council receives from Government and revenue generated through charges like council tax and parking) from its predicted spend on delivering services like education, social care, libraries and hubs, street cleansing, street lighting, road maintenance etc. Currently Cardiff Council delivers around 700 services to residents across the city.
Cllr Weaver added: "The estimated £53m budget gap for next year reflects the dramatic acceleration in inflation and increasing economic uncertainty. Costs are going up but there's no sign that the money we receive from Government will increase by enough to meet these costs. Take energy as an example. Next year we are expecting increases of more than 350% for gas and 150% for electricity. That could see our energy bills increase by £15 million in 2023/24.
"Food costs are escalating, meaning it will cost the council around £1.4m more to prepare school meals. Fuel inflation is affecting the cost of operating the Council's vehicle fleet, most notably in waste management, and this all comes at a time when demand for our services is rocketing.
"During difficult times, many of the city's residents, particularly the most disadvantaged, will also turn to the Council for support. That is already apparent given the huge increase in the number of people contacting the Council's advice service, which is up by 107% since April last year.
"Taken together, the Council is facing soaring demand pressures and spiralling costs resulting in a budget challenge as great as anything faced over the past 10 years."
The report being brought to Cabinet puts the spiralling increase in the 2023-24 budget down to a number of things, including:
- Rising inflation and the effect this is predicted to have on the costs to Cardiff Council for goods; workforce pay; and commissioning services.
- Increasing demand for Cardiff Council services. The most significant of these is in Children's and Adult Services not only in terms of numbers, but also in terms of the complexity of cases, and therefore the time needed to manage them appropriately.
- Loss of income caused by the cost-of-living crisis.
Cllr Weaver said: "Ultimately, most of the budget gap will need to be identified through budget savings. As always, every effort will be made to continue to identify efficiency savings. However, building on the levels of savings found over the past decade, it will not be possible to balance the 2023/24 budget through efficiencies alone, and there will inevitably be a need for savings that impact on service delivery. Council directorates are currently drawing up service change options for review. We will be consulting with residents on likely changes and possible cuts in advance of setting the budget early next year."
You can read the full budget report here.
How well is your council working for you? Annual report appraises performance
Cardiff Council's ambitious programme to create a stronger, fairer and greener capital city is evaluated in a new report which rates the progress being made by the authority.
The report looks to provide an honest assessment of the council's work over the past year and uses feedback from residents, the scrutiny function and government auditors to ensure the council's review of performance is fair and balanced.
Cardiff Council Leader, Cllr Huw Thomas said: "Our ambition is to make Cardiff a greener, fairer, and stronger capital city. To achieve this, we must focus on delivering the best public services we can.
"This report offers an important measure of the progress we have made in realising our ambitions. The judgements made in it have also taken into consideration the wider political governance of the Council, and our residents and rightly so."
The Council's assessment of its performance is considered by the authority's Performance Panel, which brings together all the Scrutiny Committee Chairs, the Policy Review and Performance Scrutiny Committee, the Governance and Audit Committee, and Council alongside resident surveys to ensure a balanced assessment of performance is delivered.
The report shows that the council has improved educational standards; delivered on the largest council housing development programme in Wales; created over 1,000 new jobs and safeguarded 900 in the local economy last year; reduced numbers of people sleeping on the streets; and worked on climate change projects through the One Planet Cardiff strategy.
Read more here:
https://www.cardiffnewsroom.co.uk/releases/c25/30105.html
New rights for tenants as Renting Homes (Wales) Act 2016 comes into force
One of the biggest changes in the social and private rented housing sectors will be introduced in December with the implementation of the Renting Homes (Wales) Act 2016.
The Act comes into force on December 1, 2022 and will apply to councils, housing associations, supported housing and private accommodation and has major implications, including giving greater security to tenants and placing new responsibilities on landlords.
Cardiff Council's Cabinet will discuss the implications of the new Act for the Council at their meeting on Thursday, October 20 and are recommended to approve the proposed approach to implementing the changes required, including the introduction of new ‘occupation contracts' for all council tenants and changes to procedures to comply with the new legislation.
They include:
- Renaming local authorities and registered social landlords as ‘community landlords', and tenants as ‘contract holders'
- Ensuring contract holders are entitled to two months' notice of any rent increase
- Giving contract holders enhanced succession rights. Under the new legislation, up to two successions will be allowed
- Extending rights to joint tenants who will be able to leave a property without ending a contract and new tenants added if, for example, a relationship breaks down and one partner leaves the property
- Giving councils the power to repossess an abandoned property without a court order
- Introducing a repair standard that sets out how to determine if a property is fit for human habitation
In the private rented sector, which plays a significant role in the council's housing strategy to improve access to affordable homes, landlords will now have to give their contract holders six months' notice of eviction. But this notice cannot be served within the first six months of the contract, effectively meaning a contract holder who does not breach the contract can live securely for 12 months.
The report on the new Act acknowledges that some private landlords might be prompted to leave the rental market because of the new measures. To counter any further loss of such accommodation and the consequent impact on homelessness services, support is being provided to private landlords to help them to understand and adapt to the requirements of the new Act. One way that the council is seeking to support landlords is by offering to lease their properties and take over the often complex management issues related to renting a property.
Cabinet Member for Housing and Communities, Cllr Lynda Thorne, said: "The new Act means considerable changes to the way the Council, as a community landlord, lets and manages its properties.
"We take our responsibilities as landlords very seriously and welcome the changes introduced by the legislation.
"We also recognise the major role private landlords play in providing housing and alleviating homelessness in the city and have developed a range of initiatives to encourage landlords to stay in the market and offer their properties for use by homeless clients or others in housing need."
Read more here:
https://www.cardiffnewsroom.co.uk/releases/c25/30102.html
Council to take action to keep leisure centres open amid energy crisis
Cardiff Council is looking at ways it can help maintain leisure centre services in the city amid rising energy costs.
The social enterprise GLL currently has the contract to run 8 Cardiff leisure centres, which are owned by the council, saving the local authority £3.5m in annual subsidies for the facilities.
But rising energy costs mean the not-for-profit organisation is now facing a significant loss next year on top of two years where business was heavily affected by the pandemic.
Cabinet Member for Culture, Parks and Events, Cllr Jennifer Burke-Davies, said: "The challenges facing GLL in Cardiff are replicated across the UK leisure industry, and we've already seen stories in other areas of prices increasing significantly, or services being cut and facilities closing - especially swimming pools which cost so much to heat. Those aren't roads we want to go down and we're determined to do what we can to maintain existing services for residents by taking action to relieve the crippling impact of rocketing energy prices and putting in place longer-term measures to ensure the sustainability of the GLL contract."
While GLL has seen around 90% of income return since the pandemic ended, the rising cost of energy means it is looking at a significant operating deficit in Cardiff for the 2022/23 financial year.
In the light of these challenges a report to Cardiff Council's Cabinet recommends the approval in principle of:
- A capped, relief payment to GLL to help offset the rise in energy costs.
- Working to enable GLL to access energy at the same lower rates as the Council through the Crown Commercial Service.
- Developing a strategy to replace the energy infrastructure at each site to provide lower-cost, renewable energy.
Given that GLL is delivering a service on behalf of the Council, the Council will explore whether it is possible to connect GLL into the public sector energy consortium which would enable GLL to benefit from lower energy costs secured by the local authority's bulk-energy buying power.
Read more here: