Finance Local Government

Update to the Provisional Local Government Settlement 2016-17

23 February 2016

Article by Owen Holzinger and David Millett, National Assembly for Wales Research Service

During the debate on the Draft Budget 2016-17 on 9 February 2016 the Minister for Finance and Government Business (Jane Hutt AM) announced an additional allocation of £2.5 million from Welsh Government reserves to support the councils of Powys, Ceredigion and Monmouthshire.

The £2.5 million allocation will be distributed as follows;

  • Powys – £1.95 million
  • Ceredigion – £0.44 million
  • Monmouthshire – £0.11 million

The three local authorities receiving a proportion of the additional allocation had the largest percentage decrease in Aggregate External Finance (AEF) in the provisional Welsh Local Government Settlement published 9 December 2015. Aggregate External Finance is the money given by Welsh Government to local government and is the sum of the Revenue Support Grant and re-distributed National Non-Domestic Rates.

The Minister for Public Services (Leighton Andrews AM) outlined the proposed updated distribution of AEF on 10 February 2016, which details allocations for each council and percentage change in AEF relative to the 15-16 settlement. The total change in AEF represents a reduction of £54.3 million compared to £56.8 million in the original provisional settlement.

The average reduction in AEF will now be 1.3% compared to 1.4%, with Powys, Ceredigion and Monmouthshire councils facing the greatest reduction of 3%. Within the original provisional settlement Powys had faced the largest reduction of 4.1%.

The Welsh Government is due to publish its Final Budget on 1 March, following this the Final Local Government Settlement will be presented to the Assembly for approval.

Percentage change in AEF for the updated provisional Local Government settlement is summarised in the accompanying chart.

draft budget 2016-17 (Updated Local Government Settlement)-01

View this post in Welsh

Darllenwch yr erthygl yma yn Gymraeg


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