Wales politics

Cardiff council 'needs radical change' to balance books

Image caption Cardiff council budget meetings have already been marked by protests

Further tax rises and "radical" changes to public services will be needed to balance the books of Wales' biggest council, officials have warned.

Cardiff council said it faced a budget shortfall of up to £56.4m next year.

Councillors have been advised to plan for council tax rises of at least 4.5% for the next three years.

One idea being discussed is setting up a company to run council services such as highways and waste, which could also bid for work from other authorities.

Tax rises will be decided when the council sets its budget next February.

Funding cut

Cardiff council leader Phil Bale came under pressure over a package of cuts and a 5% council tax rise to balance the 2015-16 budget, surviving a vote of no-confidence from the council and a leadership challenge from his own Labour group.

A strategy report says the council faces a shortfall of £47.4m in 2016-17, expected to add up to £117m three years later.

It is based on an expected 3% cut in funding from the Welsh government.

But the report says a worst-case scenario could see the budget gap rise to £56.4m next year and £145.7m by 2018-19.

Finance director Christine Salter said there was "real potential" for the council to fail to balance its budget "unless radical policies and strategies are adopted".

Image caption Waste collection could be run by an 'arm's length' company owned by the council

Graham Hinchey, the council's cabinet member for services, said work was already under way on "alternative delivery models" to cope with budget pressures.

"Cardiff is the fastest growing city in the UK and consequently demand for the services we provide is growing while funding is reducing," he said.

"We can't be under any illusions that we face some very tough choices."

The report recommended the council urgently considers how to reduce its assets as a way to bring in money and cut repair and maintenance costs.

One idea is to set up an "arm's length" company owned by the council to run services such as highways, parks, and waste collection, which it is claimed could save or raise £4m a year.

Welsh Local Government Association chief executive Steve Thomas said the "harsh reality" is that too many councils in Wales are being "forced to financial breaking point".

He added: "Cardiff council should be commended for proactively exploring all the options that are available, to ensure their communities will benefit from more sustainable and affordable services in the future."

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