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13 October 2013
Councils in financial trouble

Financial Speculation by a senior Cardiff councillor

Press report submitted by a reader

Following on from a reader's letter (Readers' Letters page), we print the following to make the matter more clear:-

Two councils are understood to be mentioned by a senior Cardiff councillor who has speculated could “go bust” next year due to budget cuts.

In an interview with the BBC, Russell Goodway, Cardiff council’s cabinet member for finance, said he believes some councils “will run out of money before they can make the savings”.

The veteran Labour councillor said the authorities “would therefore have to be bailed out by someone”, adding that he had heard two councils “would go bust next year”.

Coun Goodway did not specify which councils he was referring to. He yesterday failed to respond to requests to confirm the authorities were Merthyr Tydfil and Blaenau Gwent.

Both councils were asked to respond to the speculation, with neither denying outright that it might “go bust”.

A Blaenau Gwent council spokesman last night said: “We do not comment on speculation and rumour about or from other authorities.

“Blaenau Gwent, like Wales’ other local authorities face difficult decisions with cuts to public services an inevitable result of the reduced funding announced in Welsh Government’s draft budget for 2014/15.

“We are well advanced with our plans to meet the significant financial challenges we face and will announce the details of our proposals when our final budget settlement is agreed.”

Councillor Brendan Toomey, leader of Merthyr Tydfil council, added: “Coun Goodway is extremely well respected in local government circles, however, until we actually know what the final settlement is for the authority, it is difficult to comment further.

“We are working on a worst case scenario of a -5% reduction, which will have devastating effects on many of the services that we currently provide to the citizens of the county borough of Merthyr Tydfil.”

The reader (Readers Letters) suggests that Neath Port Talbot may one such council going by figures he has seen.   No doubt this will be disputed by NPT officials - as indeed we hope it will be.

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