9. Dadl y Ceidwadwyr Cymreig: Ariannu llywodraeth leol

Part of the debate – Senedd Cymru am 5:30 pm ar 29 Mawrth 2023.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Peter Fox Peter Fox Conservative 5:30, 29 Mawrth 2023

(Ddim wedi ei gyfieithu)

We have to reconcile the fact that there is £2.75 billion-worth of usable reserves at the disposal of councils whilst we have a council tax average rise of 5.5 per cent. My contention is that there is something fundamentally wrong with a formula that enables some councils to provide their services while accumulating huge levels of reserves, while others struggle to receive enough to provide their statutory services. The formula is out of date, it doesn't recognise well enough things like rurality, sparsity and the unit cost of delivery in large and rural counties.

Can I thank Llyr for his contribution? Sadly, we've heard this a lot today, blaming austerity, blaming the UK Government, but the fact is that this has been devolved for 25 years. The money that flows to Wales is unhypothecated. That means it can be spent in any way the Government wishes. It is totally devolved, and choices can be made. Those choices of where that cake can be sliced and how it can be divided are at the discretion of the Government. The cake may not be big enough, but the reality is the current system gives crumbs to some and large wads of cake to others. That is morally wrong. We need to do something to change that, moving forward.

Mike was quite right, and I touched on some of that in my opening about school balances and other elements of the reserves. Mike's also right that we need to understand how the SSA, the standard spending assessment, is built, so that we can challenge it and analyse it further.

I have nothing but respect and admiration for our councils. The work they do is phenomenal. As a past leader for 13 years, I know how hard it has been for them, and it really hurts me when I hear people like Rhianon shouting that we don't understand local government. We do understand local government here, and that's why we're raising this really important debate today.

Janet highlighted again the need for a referendum, highlighting those issues in Conwy, with those high increases, as has Darren, recognising it's just not tolerable. We do need an opportunity for the public to be able to hold to account through a referendum to challenge those increases.

Tom pointed out the need for best value, and he demonstrated how many parts of Wales aren't necessarily given the best value for the money they take. The fact is the current funding formula is enabling unacceptable variances in councils' positions and allows unacceptable levels of reserves to be accumulated by several councils at a time when families face huge financial challenges. This is morally wrong. Yes, reserves should not be frittered away, and they shouldn't be used for recurring costs either, but they shouldn't be stacked up at a time of great need. We had a plan in the budget for how we could mobilise excessive reserves to create a sector-wide floor, to enable all authorities to maintain low council tax for a couple of years through this difficult period, and it wasn't taken on board. This is what we could have done; we could have actually achieved something here.

We do need Labour Ministers to stand up for the people of Wales by commissioning an independent review of the Welsh local government funding formula so that a sustainable future can be secured for councils and their taxpayers. We need the Welsh Government to review the levels of useable and earmarked reserves and work with the sector to mobilise excessive reserves to keep council tax as low as possible for the duration of these difficult times. At the end of the day, it's the hard-working people of Wales who will have to face the brunt of huge council tax rises, and that's why we also believe local authorities should be required to hold a local referendum when proposing an excessive increase in council tax before implementing such a rise.

To conclude, Llywydd, we urgently need to see a change in the local government funding system, ensuring people get value for money when it comes to their taxes. So, Llywydd, I ask Members today to support our motion.