Cardiff Council is preparing for the possibility of significant service cuts as it faces a projected £49 million budget shortfall for the 2025-26 financial year. The anticipated gap is more than double what the Council had to address in the 2023-24 period, raising concerns about how the city will manage its finances without reducing vital services.
A leading figure in the city’s finance department expressed serious concerns over the magnitude of the deficit and indicated that every area of council service could be under review in the coming months. While raising council tax is expected to contribute to bridging the gap, it is clear this measure alone will not be sufficient to address the shortfall.
A Pressing Financial Challenge
In recent years, local councils across the UK have faced mounting financial challenges, with rising costs and growing demands on public services placing increasing strain on budgets. Cardiff Council has not been immune to these pressures, and the expected £49 million shortfall for the upcoming financial year represents a significant financial hurdle.
This shortfall comes on the back of earlier deficits. The Council has already dealt with a budget gap of £30 million in the current year and £24 million in the previous year. The financial outlook remains bleak, with forecasts suggesting that Cardiff may face a cumulative deficit of £148 million from 2025-26 to 2028-29.
Difficult Decisions Ahead
Cardiff Council has already been forced to make a number of difficult decisions in recent years in an attempt to balance its books. In its most recent budget, for 2024-25, proposals were floated to reduce street cleaning services and decrease the number of public bins in residential areas. While these particular cuts were avoided, other controversial measures, such as reducing the frequency of black bin bag collections, went ahead.
With the financial pressure showing no sign of easing, council leaders have confirmed that every service provided by the city is being reviewed. While it is too early to say definitively which services will face reductions, officials are not ruling anything out. The focus is on identifying where savings can be made while maintaining essential services.
According to those involved in the budget process, the Council is committed to exploring every option before making cuts. This includes looking for efficiencies within the organisation, making better use of technology, and seeking alternative funding sources where possible. However, officials acknowledge that past experience suggests some combination of tax increases and service reductions may ultimately be necessary to close the gap.
The Role of Council Tax
Council tax increases are likely to form part of the solution, but they alone are not expected to cover the full deficit. Cardiff residents have already seen a rise in their council tax bills, with a 6% increase introduced for the current financial year. Other fees, including those for school meals, car parking, and residential parking permits, were also increased as part of efforts to shore up the Council’s finances.
Compared to other local authorities, Cardiff’s tax increase is moderate. In some areas of the country, councils have raised taxes by more than 10% in response to growing budgetary pressures. Cardiff’s leaders have said they will not know the exact figure for any further increase until the spring of 2025, when the full scope of the financial gap is clearer.
While council tax will play a role in balancing the books, it is clear that more will be needed. Council officials are already considering additional ways to generate revenue, from efficiency savings to potential service changes. However, they stress that any final decisions on service reductions will be made only after consultation with the public.
Seeking Public Input
Public consultation will be a key part of the budget-setting process. In the coming months, Cardiff residents will be asked for their views on which services are most important to them. A city-wide survey, set to be distributed in the autumn, will gather opinions on a range of issues, including which services residents feel should be prioritised and where cuts might be acceptable.
City leaders believe this consultation is essential in helping guide the difficult decisions ahead. The feedback provided by residents will help inform which services are preserved and which may need to be scaled back. While the financial challenges are significant, officials are committed to ensuring that the voices of the people of Cardiff are heard throughout the decision-making process.
Broader Financial Uncertainty
The financial challenges facing Cardiff are part of a wider pattern of budget shortfalls affecting local authorities across the country. The amount of funding local councils receive from central government has a direct impact on their ability to provide services, and decisions made in Westminster will play a critical role in shaping Cardiff’s financial future.
Current financial projections are based on existing public spending plans, but changes to national budgets could alter the landscape. Leaders in Cardiff are closely watching for updates from central government in the months ahead, as any shifts in public spending could impact the level of funding provided to local councils.
While Cardiff’s leadership remains hopeful that changes at the national level could alleviate some of the financial pressure, they acknowledge that the city must prepare for the possibility that no additional support will be forthcoming. As such, Cardiff Council continues to plan for difficult choices, with the priority being to ensure that the most essential services are protected wherever possible.
Cardiff Council is facing an unprecedented financial challenge as it prepares for a £49 million budget shortfall in 2025-26. With every service under consideration for cuts and council tax rises on the horizon, the city is entering a period of financial uncertainty. Public consultation will play a key role in shaping the decisions that lie ahead, but it is clear that some tough choices will need to be made. As the Council awaits further information on national spending plans, it remains focused on finding a balance between generating revenue and maintaining the services its residents rely on.
