'Difficult decisions' warning as council faces £8.3 million budget overspend

The Cyngor Gwynedd building in Caernarfon
-Credit:Google Maps


A warning has been issued that "difficult decisions lie ahead" in Gwynedd as its council reports a projected £8.3 million overspend. Rising costs, demand for services and pressures on budgets has seen Cyngor Gwynedd report "significant" overspends in five departments.

A total of 83% of the £8.3m relates to costs in the adult and children care field, a council cabinet meeting held on Tuesday, January 21 heard. During the meeting it was agreed to support steps put forward by the council's chief executive Dafydd Gibbard to address the overspends.

They affect the departments for adults, health and well-being, children and families, highways, engineering and YGC and environment. Presenting the report, Councillor Huw Wyn Jones, cabinet member for finance, said in the adults department a £3.3 million overspend was expected compared with £3.9m in 2023/24.

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A "combination" of factors were behind the overspend, including an increase in the pressures on domiciliary care provision, higher staffing costs, sickness levels and "high rates of non-contact hours within the internal provision," Cllr Jones said. Other issues included direct payments overspending by £1.5m in the older people service, and supported accommodation in the learning disabilities service.

The children and families department overspend had also "worsened substantially" increasing to £3.7m, from £2.6m, mainly due to increased out-of-county placement costs. The department had also seen the "complexity" of packages increasing, and more use of unregistered placements.

In education, an additional budget allocation had been received of £896k on a permanent basis, and a further £896k for one year, to address "pressure on the school buses and taxis field following the re-tendering of contracts". "A combination of grant receipts and cutting back on spending meant that an underspend is anticipated by the department," Cllr Jones said.

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And as the income levels of Byw'n Iach, which provides leisure services, were disrupted by Covid, the company received annual financial support from the council which was £550k in 2022/23 and £308k in 2023/24 - above the contractual payment of the delivery contract. The required sum was now £201k.

The highways, engineering and YGC department was also expected to have an overspend of £699k, the environment department £970k, and waste collection and recycling £667k. In housing and property, despite "significant pressure" on the emergency accommodation services continuing, it was expected to underspend by £303k.

Corporate also reported an underspend due to "an additional tax yield and prudent projections" when setting the 2024/25 budget. Chief executive Dafydd Gibbard said: "The report sets the context for the decisions we have to make in the coming weeks, and setting the council tax."

He added: "The issues our departments face go far beyond any emergency measures that can be put in place." He said: "We use the term overspend every year - we should erase that term - it gives the impression it is spending out of control, but that's not the case, what it means is there is not enough money in the budget due to increasing demand for our services and increasing costs.

"Departments only have two choices, to overspend or to cut services and to not provide services when people come to our door. Stopping services is just not an option....these are extremely difficult decisions."

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The cabinet also formerly agreed to delegate the right to make the required budget transfers to "reflect the current pressures". They also agreed to approve the additional financial support to Byw’n Iach.

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