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Audit report flags financial risks for cash-strapped Pembrokeshire County Council

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PEMBROKESHIRE COUNTY COUNCIL’S financial future is under scrutiny following an extremely critical report by Audit Wales, which warns of mounting risks due to the authority’s reliance on reserves and failure to address underlying budget pressures. The Financial Sustainability Review, published in October 2024, raises concerns about the council’s ability to deliver services and secure long-term financial stability.

The council’s decision to reduce the planned Council Tax increase for 2023-24 from 16.3% to 12.5% is highlighted as a key issue. Paragraph 22 of the report states:

“The revised 2023-24 budget was therefore balanced using reserves to fund the shortfall between income and expenditure. This has implications for the sustainability of the Council’s finances, as the approach does not address the underlying causes of the funding gap.”

Short-term fixes, long-term consequences

Audit Wales identifies several factors contributing to the council’s precarious position:

  • Depleting Reserves: Reserve balances are projected to fall sharply, undermining the council’s financial resilience.
  • Unaddressed Funding Gap: The Medium-Term Financial Plan (MTFP) for 2024-28 outlines projected deficits but lacks clear solutions to close these gaps.
  • Low Council Tax Rates: Pembrokeshire has some of the lowest Council Tax rates in Wales, limiting revenue growth.
  • Future Tax Burden: Reduced tax increases in the short term may result in steeper hikes in future years to recover lost revenue.
  • Challenging Budget Decisions: The decision to suspend standing orders to amend the MTFP raises questions about governance and transparency.

Audit Wales warns that without a robust, long-term strategy, the council will struggle to prioritize funding and address the structural challenges threatening its financial sustainability.

Impact on residents and services

The report underscores the implications of the council’s financial approach for local residents and services. While reducing the tax increase may have provided short-term relief to taxpayers, it comes at the cost of further reliance on reserves and the potential for drastic measures in future budgets. These could include severe cuts to essential services or substantial tax hikes, placing significant strain on the community.

Additionally, overspending in key service areas adds to the challenges, as rising costs and demand continue to outpace available funding. Audit Wales emphasizes that the council’s reliance on reserves only delays difficult decisions, creating greater risks in the years ahead.

Cllr Mike Stoddart countered the report by saying: “Since the present administration came to power in 2017, Band D council tax has risen from £883 to the present £1561.

“That is an almost 80% increase compared to the rate of inflation (CPI) according to the Bank of England’s calculator of less than 30%.

“In addition they have diverted most of the second and empty homes council tax premiums into general funds.

“Their appetite for taxpayers’ money seems insatiable.

“I accept that there are service pressures in adult and children’s social care, but nowhere near enough to account for these eye-watering increases.

“So, instead of Audit Wales (AW) encouraging ever larger council tax bills, I would like to see proposals for the more efficient delivery of services – plus a dramatic reduction in the bureaucracy imposed on the council by the Welsh Government and Audit Wales, itself.

“Where I do agree with Audit Wales is with regard to its concerns about the way Standing Orders were manipulated to allow last-minute changes to last year’s council tax rate.”

Call for urgent action

Audit Wales recommends urgent steps to develop a comprehensive financial strategy that addresses these issues and ensures sustainability. The council must reduce its dependency on reserves, identify alternative funding sources, and implement measures to close the funding gap.

Pembrokeshire County Council has yet to respond publicly to the report. Residents and stakeholders now await clarity on how the authority plans to address these critical concerns and safeguard the county’s financial future.

This report highlights the challenges local authorities face amid rising costs and limited income, placing Pembrokeshire under the spotlight as it navigates turbulent financial waters.

 

Business

Plaid energy policy challenged by Labour after Adam Price interview

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LABOUR SAYS MINISTERS MUST EXPLAIN COST AND TIMETABLE FOR PYLON PLANS

PLAID CYMRU’S approach to energy infrastructure has come under scrutiny after Energy Minister Adam Price was challenged over plans to reduce the use of overhead pylons in Wales.

Mr Price defended the Welsh Government’s position during an appearance on BBC Radio Wales’ Sunday Supplement, arguing that communities must have greater confidence in how major grid projects are handled.

Plaid Cymru has pledged to give communities a stronger voice over energy developments and to look more closely at alternatives to overhead transmission lines, including underground cabling where possible.

The issue has become increasingly sensitive in rural parts of Wales, where proposed pylon routes linked to renewable energy schemes have raised concerns about landscape impact, tourism and local consultation.

However, Welsh Labour said the minister had failed to explain when any restriction on pylons would take effect, or who would pay the additional cost of placing cables underground.

A Welsh Labour spokesperson said: “Adam Price keeps saying how clear their manifesto was and yet he won’t say when they’re banning pylons. They won’t say who is paying for the extra cost of undergrounding cables.

“Without certainty, companies won’t invest. That’s thousands of clean, green energy jobs at risk. Plaid need more than a plan to have a plan.”

Labour said the Welsh Government must now set out how its policy would work in practice, including whether it amounts to an outright ban, what exemptions would apply, and how any extra costs would be funded.

The debate highlights the challenge facing ministers as Wales seeks to expand renewable energy generation while addressing public opposition to large-scale grid infrastructure.

 

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Community

Pembroke Fair praised as well-organised community event

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HORSES, STALLS AND FAMILY CROWDS RETURN TO MONKTON

FAMILIES, horse owners and visitors turned out in force for Pembroke Fair on Saturday (May 23), with many praising the event as one of the best organised in recent years.

Held at the Community Centre Field in Monkton, the annual fair brought together horse owners, traders and local families for a traditional day centred around horses, ponies, stalls and socialising.

Coloured cobs, heavy horses, ponies and horse-drawn traps attracted attention throughout the day, with many visitors gathering around the field to watch the animals being shown and led around the site.

A variety of stalls selling everything from clothing and ornaments to tack and second-hand goods helped create a lively market atmosphere, while food vendors kept visitors fed throughout the day.

Despite overcast conditions at times, the event remained busy, with many attendees staying for several hours to enjoy the traditional fair atmosphere.

Community members later took to social media to praise the smooth running of the event, with several publicly thanking organiser Charlie Price for his efforts in bringing the fair together.

Comments described the day as “well organised” and praised the welcoming atmosphere, with many saying it was encouraging to see a long-standing local tradition continuing to thrive.

The fair once again brought together members of the travelling community, local residents and horse enthusiasts from across west Wales.

A horse drive was also due to take place on Sunday (May 24), continuing the weekend’s celebrations.

Photo captions:

Traditional gathering: Horses, ponies, horse-drawn carts and market stalls drew crowds to Pembroke Fair in Monkton on Saturday (Pic: Herald).

 

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News

Watchdog criticises health board over £10m GP contract checks

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A HEALTH board has been criticised by Audit Wales after GP contracts worth more than £10m were awarded without sufficient due diligence checks.

Aneurin Bevan University Health Board allowed a GP partnership associated with eHarley Street Primary Care Solutions to take on eight GP contracts in south-east Wales, with a combined annual value of around £10.1m.

Audit Wales said the board should have carried out greater scrutiny before approving the arrangements, including checks on financial resilience, workforce plans, business risks and the partnership’s ability to manage several practices at once.

However, the watchdog found no evidence of fraud and noted the board was dealing with significant pressure in general practice, including vacant contracts and limited interest from other bidders.

The report said weaknesses in governance and scrutiny contributed to later disruption and uncertainty for patients and staff when problems emerged.

Concerns included financial and workforce pressures, unpaid invoices, and issues relating to tax and pension payments. Some contracts were later handed back, requiring the health board to step in to protect services.

Natasha Asghar MS, Welsh Conservative Shadow Cabinet Minister for Health and Social Care, said the findings were “deeply concerning”.

She said: “Patients and staff were left facing disruption and uncertainty because proper scrutiny was not carried out before these contracts were awarded.

“The Welsh Conservatives believe lessons must be learned to ensure robust checks are in place, protect frontline services and restore confidence in primary care across Wales.”

Aneurin Bevan University Health Board accepted the recommendations and said it had already strengthened its processes.

Audit Wales said the case highlighted the need for stronger checks before GP contracts are transferred, particularly when a single partnership is taking on multiple practices in a short period.

 

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