Welsh councils plan cuts to plug £500m budget gap

Welsh councils are facing "unsustainable" budget pressures over the next few years according to the body which represents them.

The Welsh Local Government Association (WLGA) said funding shortfalls could "significantly impact" councils’ ability to deliver essential services.

The BBC has identified a budget shortfall of at least £540m across Wales by 2026-27.

The Welsh government said it meets local authorities "regularly" to discuss the "very real challenges they face" ahead of its draft budget in December.

Rhondda Cynon Taf (RCT) and Merthyr Tydfil councils are planning to withdraw funding for some school transport, and Caerphilly council is currently consulting on proposals to do so.

From September 2026 Merthyr will no longer fund over-16s to travel to college outside of the council area, apart from those attending Welsh medium or faith schools.

The changes in RCT will be introduced from September 2025, and students who study at college Coleg y Cymoedd’s campus in Nantgarw said the change will have a big impact on future students’ ability to attend the college.

Seventeen-year-old Cavan Griffin, who lives in Rhydyfelin, said the local school sixth form has recently closed, meaning that young people wanting to do A-levels have to travel.

"I’m working a job" he said, "but I couldn’t keep up every day paying for a bus back and forth to college."

His classmate Abi Meredith agreed: "If you’re going to make people within that radius pay, they’re not going to come to college."

Fellow A-level student Alfie Warner already walks because he lives within two miles (3.2km) of the Nantgarw campus and it takes him about half an hour each way.

He said it’s a challenge in the winter, adding: "It limits you sometimes for after school clubs because you just want to get home."

Coleg y Cymoedd’s principal, Jonathan Morgan said around a thousand students could be affected by the proposed changes in the three councils' policies.

He said 42% of learners at the college come from families where the household income is below £23,000 a year.

"To push further costs onto those families by making them self-fund transport is for me a step too far," said Mr Morgan.

RCT council said its school transport policy remained more generous than many other Welsh councils, but it "had to make difficult decisions to ensure that services continue to be delivered in a financially sustainable way".

Caerphilly council said its "transport budget is under significant financial pressure" and it would "fully consider the views of the community" before agreeing any changes in future.

Merthyr Tydfil council said the changes had been approved after "significant discussion" as part of "the efficiency savings needed with the authority".

There are some services which local authorities are legally bound to provide, like education and social services care for children and older people.

But as budget pressures have grown, many have cut back on other services which they do not have a legal duty to give.

Neath Port Talbot council has a predicted deficit of nearly £160 per person by 2026-27, and the cabinet member for finance, Simon Knoyle, warned the next few years look "bleak".

He said: "The last two years have already seen us take almost £45m out of the base budget through efficiency measures and cuts."

But Mr Knoyle said the council was trying to prioritise vulnerable residents.

It recently expanded its welfare rights team which helps people to claim benefits they’re entitled to.

Allison Southall manages the team, which is part funded by the Welsh government, and said she helped 3,400 people claim an extra £10.5m last year.

"Any reduction in funding would have a huge impact on the service we’re able to provide, bearing in mind we’ve got a current case load of about 750 people," she said.

With the UK government Budget due at the end of October and the Welsh government draft budget following in December, the WLGA is calling on both governments "to step up and provide the investment we need to keep these essential services running".

The Welsh government said it recognised "the very real challenges local authorities are facing".

"We meet regularly with local authorities to discuss these against the backdrop of the current financial climate, as we prepare our own draft budget," a spokesperson said.

The UK government said that funding councils in Wales is the responsibility of the Welsh government, and it is "committed to working with them to achieve the best possible funding for local councils in Wales".