Concerns over £72 million shortfall's impact on council services
A local Senedd Member has raised concerns about a £72 million funding shortfall's effect on council services.
Peter Fox has written to Monmouthshire Council's leader regarding the impact of the shortfall in employer National Insurance (NI) funding.
The shortfall comes following the UK Government decision to increase NI contributions without providing full funding to local authorities, leaving public sector bodies to pay more to employ staff.
Mark Drakeford, Labour's finance secretary, assured in November that additional funding would cover these increased costs.
This week, he revealed the UK government would not provide full funding, leaving a £72 million shortfall across Welsh public services.
Mr Fox said: "Mark Drakeford assured us that these tax increases would not fall on the public sector, so last week's news was bitterly disappointing.
"Local authorities will now face a difficult choice: either cut vital services or raise council tax to cover the extra costs."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
5 hours ago
- Yahoo
Consumer spending slows to lowest growth of the year amid falling confidence
Consumers slowed their spending to the lowest growth of the year in May amid falling confidence, figures show. Sales of fashion and full-price big ticket items were held back by faltering consumer confidence, although gaming bucked the trend due to popular new releases, according to the British Retail Consortium (BRC)-KPMG Retail Sales Monitor. Total retail sales across the UK were up by 1% year-on-year in May, against growth of 0.7% a year ago, driven by food sales increasing by 3.6% on the back of football tournaments and two bank holidays, prompting spending on BBQs and picnics. Non-food sales were down 1.1% year-on-year in May. BRC chief executive Helen Dickinson said: 'Consumers put the brakes on spending, with the slowest growth in 2025 so far. 'Retailers are grappling with the £5 billion in extra costs from higher National Insurance contributions and wages, which kicked in during April. They also face an additional £2 billion later this year from new packaging taxes and remain concerned about the consequences of the Employment Rights Bill. 'Ensuring the new Bill supports workers' rights without undermining retailers' ability to continue to provide jobs and investment in people will determine whether Government achieves economic growth across the country or not.' Linda Ellett, UK head of retail and leisure consumer markets at KPMG, said: 'While the sunshine continued, the pace of retail sales growth didn't in May. 'Early seasonal purchases were likely a factor, as was a dampening of some spending appetite as households reflected upon the recent combination of essential bill rises. But May still saw slight growth, driven mainly by food and drink, with non-food purchases falling overall.' Separate figures from Barclays also show consumer card spending grew just 1% year-on-year in May, down from April's 4.5%. The bank said May's two Bank Holidays encouraged discretionary spending, although this was offset by wet weather in the second half of the month, and by consumers cutting back amid falling confidence in personal finances. Spending in pharmacies and on health and beauty recorded the highest growth in May – up 12% – linked to the UK's sunniest spring on record and a surge in NHS website visits for hay fever advice. Airline spending jumped by 9.7% as consumers made summer plans, while garden centres saw a 7.2% increase. Karen Johnson, head of retail at Barclays, said: 'Consumers are clearly becoming more value-conscious as financial pressures persist, but they're still finding joy in the everyday – whether that's a small treat, a cinema trip, a garden project, or a carefully planned getaway. 'The double Bank Holidays in May and record sunshine will have given non-essential spending a helpful boost, but this was largely outweighed by the rainy weather in the second half of the month, while longer-term uncertainty continues to shape how and where people choose to spend.'
Yahoo
5 hours ago
- Yahoo
Consumer spending slows to lowest growth of the year amid falling confidence
Consumers slowed their spending to the lowest growth of the year in May amid falling confidence, figures show. Sales of fashion and full-price big ticket items were held back by faltering consumer confidence, although gaming bucked the trend due to popular new releases, according to the British Retail Consortium (BRC)-KPMG Retail Sales Monitor. Total retail sales across the UK were up by 1% year-on-year in May, against growth of 0.7% a year ago, driven by food sales increasing by 3.6% on the back of football tournaments and two bank holidays, prompting spending on BBQs and picnics. Non-food sales were down 1.1% year-on-year in May. BRC chief executive Helen Dickinson said: 'Consumers put the brakes on spending, with the slowest growth in 2025 so far. 'Retailers are grappling with the £5 billion in extra costs from higher National Insurance contributions and wages, which kicked in during April. They also face an additional £2 billion later this year from new packaging taxes and remain concerned about the consequences of the Employment Rights Bill. 'Ensuring the new Bill supports workers' rights without undermining retailers' ability to continue to provide jobs and investment in people will determine whether Government achieves economic growth across the country or not.' Linda Ellett, UK head of retail and leisure consumer markets at KPMG, said: 'While the sunshine continued, the pace of retail sales growth didn't in May. 'Early seasonal purchases were likely a factor, as was a dampening of some spending appetite as households reflected upon the recent combination of essential bill rises. But May still saw slight growth, driven mainly by food and drink, with non-food purchases falling overall.' Separate figures from Barclays also show consumer card spending grew just 1% year-on-year in May, down from April's 4.5%. The bank said May's two Bank Holidays encouraged discretionary spending, although this was offset by wet weather in the second half of the month, and by consumers cutting back amid falling confidence in personal finances. Spending in pharmacies and on health and beauty recorded the highest growth in May – up 12% – linked to the UK's sunniest spring on record and a surge in NHS website visits for hay fever advice. Airline spending jumped by 9.7% as consumers made summer plans, while garden centres saw a 7.2% increase. Karen Johnson, head of retail at Barclays, said: 'Consumers are clearly becoming more value-conscious as financial pressures persist, but they're still finding joy in the everyday – whether that's a small treat, a cinema trip, a garden project, or a carefully planned getaway. 'The double Bank Holidays in May and record sunshine will have given non-essential spending a helpful boost, but this was largely outweighed by the rainy weather in the second half of the month, while longer-term uncertainty continues to shape how and where people choose to spend.' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
6 hours ago
- Yahoo
Concerns over £72 million shortfall's impact on council services
A local Senedd Member has raised concerns about a £72 million funding shortfall's effect on council services. Peter Fox has written to Monmouthshire Council's leader regarding the impact of the shortfall in employer National Insurance (NI) funding. The shortfall comes following the UK Government decision to increase NI contributions without providing full funding to local authorities, leaving public sector bodies to pay more to employ staff. Mark Drakeford, Labour's finance secretary, assured in November that additional funding would cover these increased costs. This week, he revealed the UK government would not provide full funding, leaving a £72 million shortfall across Welsh public services. Mr Fox said: "Mark Drakeford assured us that these tax increases would not fall on the public sector, so last week's news was bitterly disappointing. "Local authorities will now face a difficult choice: either cut vital services or raise council tax to cover the extra costs."
