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Welsh councils face a real spending cut of 4% next year, the Association of Welsh Districts said on Monday followin...
Welsh councils face a real spending cut of 4% next year, the Association of Welsh Districts said on Monday following the announcement of the Welsh spending settlement.

Like English councils, Welsh councils complain their spending limit of £2.7 billion is around 1% less than expected spending this year. 'Many of our 37 districts will be facing real cuts in their budgets. This will result in a reduction in services and job losses', said Harry Jones, chair of the Council of Welsh Districts' finance committee.

All the eight Welsh counties have been capped to a maximum budget increase of 1.75%, which will put them between 0% and 5% above their standard spending assessment.

The announcement of the figures for each council was confused by mistakes in the allocation of £48.5 million for community care, the next block of money being passed over to the counties as they take over more social services responsibilities. The mistakes arose because the settlement details were brought forward from yesterday to Tuesday because of a slack Commons timetable.

It appears the errors were made in the rush to get the figures ready. The average permitted increase in district budgets is around 3.4%. This means they are likely to exceed their SSAs by a total of £2m-£3m.

The increase in Welsh council tax bills is likely to be between 10% and 15%.

Next year's capping criteria mirror those for England and Wales. Welsh Secretary John Redwood also announced that Welsh councils would receive £503m in capital grants and permission to borrow next year. This represents an increase of 4%.

The Welsh Office has honoured its commitment to provide £80m for home renovation grants.

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