Increased demand and rising social care costs behind £9.8m projected budget shortfall

Increasing demands and rising costs for complex social care has accounted for 90% of Cyngor Gwynedd’s £9.8m projected budget shortfall.

The details were highlighted in a cabinet meeting where a “significant budget deficit” for the 2026/27 financial year was predicted.

The figure is based on a budget deficit of £9.4 million by the departments and a further £400k on corporate budgets.

Four of the council’s departments were over the £100,000 threshold, and expenditure in the fields of children’s extra-county placements, waste, residential and domiciliary care, post-16 care and the Derwen service were predicted above allocated budgets.

Parking and highway income targets were not being met and the council tax yield and council tax premium was below the year’s budget.

At a meeting of the cabinet on Tuesday, November 10, Cllr Huw Wyn Jones, cabinet member for finance, said: “The general picture is that we anticipate a deficit of £9.8m for 2026/27.

“Without pointing any fingers 69% is in the children’s services which is a significant amount.

“On a political point if you go through the figures, it is more or less all on social care.

“If you ask any politician in Cardiff or London listening to this today, I would ask them to think how can we do this effectively as a country not relying on overspends?”

Cllr Menna Trenholme, deputy leader and cabinet member for children, was absent from the meeting but sent a message which was read out by council leader Cllr Nia Jeffreys.

“It isn’t a matter of over spending but a matter or underfunding and an increase in demand,” she said.

“We see more children in care with more complex needs across Wales, not just Gwynedd. We have a statutory duty to support and safeguard these children.

“For me, the most important thing is that all children are safe and receive the right services at the right time, that is the priority at the root of this expenditure.”

Finance officer Dewi Morgan added: “This is the situation as it was at the end of August and what we forecast if things stay the same.

“There are still some adaptations that could be made to try and rectify the situation but I don’t think we will be able to cover all of that deficit by the end of the financial year, we will probably have to use an element of our reserves.”

Dafydd Gibbard, the council’s chief executive, added: “One of the statistics used was that 69% of the funding deficit is in the field of children.

“Another statistic to throw in is that 90% of the deficit is in social services, adults and children put together.

“Demand is increasing, the numbers of people needing services is rising and people’s needs are becoming more complex, and it all costs more.

“As a cabinet you have two choices: you either do the morally right thing by providing services or you refuse.

“In reality you don’t have a choice to refuse, there is a legal duty for you to provide services, you have no choice but to overspend.

“In terms of adults we know demand will increase putting more pressure on you trying to set the budget next year.

“Traditionally we can’t catch up with the demand and funding doesn’t follow at the same pace.

“With children it is more difficult, you won’t be able to anticipate what the increase in expenditure will be facing you in a year’s time.

“You only have two methods open to you, increase council tax or cut services. On the other hand you may just hope that funding from central government will be enough.

“We also have a new situation facing us this year with a number of properties being taken out of council tax into business rates. That is affecting any cushion we have in the corporate budget.

“We have to repay not only this year, but back pay for several previous years.”

Dale Spridgeon – BBC Local Democracy Reporter