Merthyr Tydfil County Borough Council Leader, Councillor Geraint Thomas, comments on the need to issue a Section 188 Agreement.

Following the recent announcement of the provisional Welsh Local Government Settlement on December 20^th 2023 Merthyr Tydfil is set to receive a funding increase of 3.4% for the 2024/25 financial year.

Despite this, our Medium-Term Financial Plan (MTFP) for 2023/24 to 2026/27, approved by the Council on March 8^th 2023, indicated a budget deficit of £10.5 million for 2024/25, escalating to an overall deficit of £23.3 million over the MTFP term.

Considering additional funding from the settlement and increased costs due to the pay award, high inflation, and unavoidable additional demands, the revised budget deficit for 2024/25 now stands at around £13 million.

In response to this challenging financial climate, we are actively exploring budget reduction opportunities. Unfortunately, this process necessitates making tough decisions about the services we can sustain and those we may need to discontinue.

These decisions may lead to job losses, and we must be prepared for this unfortunate outcome.  Tomorrow night, 17^th January, a report will be presented to Full Council regarding the issuance of a Section 188 letter to relevant Trades Unions. A Section 188 Notice is a legal requirement summarizing potential redundancies resulting from budget savings.

Our staff are our most valuable asset and we will seek volunteers for redundancy in an effort to keep the number of compulsory redundancies to a minimum or avoid the need for them altogether.

Collaboration with the relevant Trades Unions is crucial for credible and achievable savings.

This is an extremely difficult time for all local authorities across Wales and the scale of the challenge is significant.  I want to take this opportunity to thank our officers who are working tirelessly to identify savings.