CONWY County Council is facing a £20m budget shortfall next year and will likely overspend by more than £3m in the current financial year, with council tax likely to be increased and services cut.
The authority’s finance and resources overview and scrutiny committee will meet at the council’s Coed Pella HQ on Monday, 1 December.
A financial report up for debate at the meeting states that the latest estimated budget shortfall is £20.598m for 2026/27.
Pressures contributing to the shortfall include school and council staff “pay pressures” of £2.894m and £4.716m respectively, with both increases being set externally.
Business cases and service demand pressures total £15.145m. And despite setting a balanced budget for 2025/26 in February 2025, “it is currently forecast that the 2025/26 budget will be overspent by £3.107 million.”
The report says the overspend is “predominantly as a result of service demand” and that despite “corrective action” being undertaken, it is “highly likely” that “reserves will be eroded”.
But the council is being tasked with setting a new balanced budget for 2026/27 and is already talking about another council tax rise, despite three years of raising it by nearly 10%.
It is anticipated that the final local government settlement will be announced in January 2026, but Conwy County Council regularly receives one of the lowest annual percentage increases in Wales.
The authority has campaigned for a higher annual increase, citing its population being one of the most elderly in the UK and rising social care costs.
The report states: “The resource shortfall will need to be addressed by a combination of making budget reductions (service cuts, efficiencies, and raising additional income), increasing council tax, and applying non-recurring funding (reserves and balances).
“As the council still has one of the lowest levels of reserves and balances in Wales, which are likely to be eroded by pressures in the current year, the use of balances cannot be seen as an easy fix to avoid difficult decisions about service prioritisation or council tax increases.”
The finance and resources overview and scrutiny committee will scrutinise the report and make “appropriate recommendations”.
