November 12, 2026 - 157 views
Conwy councillors are beginning work on next year's budget, with an early financial forecast pointing to a potential shortfall of more than £25 million.
The authority's Finance and Resources Overview and Scrutiny Committee will meet next week to consider the financial outlook for 2027/28, as the council prepares for another challenging year of rising costs and increasing demand for public services.
The scale of the challenge has already been outlined in preliminary financial estimates, which suggest a potential funding gap of £25.7 million before any additional Welsh Government funding is taken into account.
However, the figure is not a final deficit. The council says its financial assumptions will need to be reviewed once more information becomes available, particularly about government funding, inflation and staff pay awards.
The pressures reflect difficulties being experienced by councils across Wales, with rising costs in areas such as adult and children's social care, education, homelessness support and home-to-school transport.
Many of these services are statutory responsibilities, meaning councils have a legal duty to provide them. An ageing population, increasingly complex care needs and higher demand for support are adding to the financial burden.
Pay awards, energy and other running costs, as well as the expense of delivering services, are also contributing to the pressure.
Conwy has previously warned that it is becoming increasingly difficult to find further savings without affecting services.
The council's Cabinet Member for Finance, Councillor Chris Cater, says next week's report is the first in a series of discussions leading towards a balanced budget.
He said the financial outlook would be influenced significantly by the amount of money Conwy receives from the Welsh Government, although even an improved settlement could leave a substantial shortfall.
The Welsh Government is due to publish its draft budget for 2027/28 on November 17, followed by the provisional local government funding settlement on December 2.
The settlement is particularly important because around 70 per cent of Conwy Council's funding comes from Welsh Government grants and redistributed business rates.
For the current financial year, Conwy received a 4.1 per cent increase in its final funding settlement, compared with a 4.5 per cent average increase across Wales. Despite additional funding being secured during last year's budget negotiations, the council said it was still not enough to meet all the pressures it faced.
Councillors will have three main options when considering how to balance next year's budget: reducing spending and finding further efficiencies, increasing Council Tax, or using money held in reserves.
Each comes with consequences. Further savings could mean changes to services relied upon by residents, while a Council Tax increase would add to household bills. Using reserves could provide temporary relief but would reduce the money available to deal with future financial difficulties.
Conwy has already made substantial savings over recent years and has warned that its scope for further efficiencies is becoming increasingly limited.
Councillor Cater said each option carried risks which elected members would need to examine and debate as part of the democratic process.
Budget Working Groups have already been held, with all elected members invited to take part in discussions about the financial position and possible ways forward.
Further reports and opportunities for councillors to scrutinise the proposals will follow over the coming months.
The final decision will be made by Full Council on March 4 next year, when members are due to agree the authority's budget and Council Tax for 2027/28.
