Councils 'could cover budget shortfalls with charges'

Councils could use fees and charges for services to cover budget shortfalls, Wales' local government minister has suggested.

Carl Sargeant was unveiling the 22 authorities' financial allocations for next year.

He warned that councils needed to speed up the process of working together as a way to save money.

Council leaders welcomed the settlement and said it would sustain their core funding.

Mr Sargeant said the average increase for council funding would be better than expected at around 1.5%, and that councils could use £50m in additional funding to freeze council tax if they wished.

But he said he recognised the pressures caused by protecting spending on education and social services.

'Prudent'

He said: "The prudent use of other sources of funding including utilising income streams from fees and charges are options available to authorities to ease these pressures."

Funding is allocated to councils according to a complex formula, but the mechanism means that there is relatively little difference between the increases across Wales.

The council getting the highest increase is Newport, with 2.06%. The lowest is Powys with 0.15%.

Areas with growing populations tend to do better.

The minister announced a new £10m fund as an incentive for collaboration between councils.

Conservatives have accused the Welsh government of not passing on enough money to allow councils to free council tax.

Tory local government spokeswoman Janet Finch-Saunders said: "This represents a challenging settlement for local authorities, which will need to strike a careful balance between keeping council tax levels down and fully funding frontline services."

Welsh Local Government Association deputy leader Aaron Shotton said: "We recognise the need to work together to deliver services and will work constructively with the Welsh government on the details of how this is best achieved using the funding available."