3.1% rise in local government funding

Core revenue funding for local government will increase by 3.1% on a like-for-like basis, compared to the current year. No local authority will receive less than a 2% increase.

Schools, social services and social care, refuse and recycling collections and other key services provided by local authorities will be backed with £5.7 billion in Welsh Government Revenue Support Grant and non-domestic rates.

This settlement reflects the government’s commitment to protect the services we all rely on every day, meaning there have been some difficult decisions to radically redesign spending plans to focus funding on such services.

A package of support for non-domestic rates benefitting every ratepayer in Wales was also announced as part of the draft Budget yesterday. This includes funding to cap the increase to the non-domestic rates multiplier for 2024-25 to 5%. This is at an annual cost of £18m and provides for a fifth successive year of support for retail, leisure and hospitality businesses.

Rebecca Evans, Minister for Finance and Local Government, said:

“In an incredibly tough financial situation, we’ve re-shaped our spending plans so we can protect the core, frontline public services provided by local authorities like schools and social care.

“As I explained yesterday, our overall funding settlement is not sufficient to meet all pressures. This has meant taking difficult decisions elsewhere in the budget to honour our commitment to councils last year of a 3.1% rise in their funding for next year.

“I appreciate the pressures local government is facing and recognise that demand for services, along with the recent very high rates of inflation, mean local government will still need to make difficult decisions on services, efficiencies, and council tax in setting their budgets.

 “We will continue to work closely together to face these shared challenges and strive to make the best use of the resources we have in order to make the most difference to the communities we serve.”

A 6-week consultation on the provisional settlement has opened today, which will end on 31 January 2024.