What assessment has the Welsh Government made of the impact of public sector pay and pension changes on local authority budgets where these have not been agreed by individual authorities?
Pay negotiations for local government non-teaching staff are undertaken collectively for England and Wales through the Joint Negotiating Council arrangements and the Welsh Government has no role in these discussions.
Pay arrangements for teaching staff are considered separately for Wales with advice from the Independent Welsh Pay Review Body including an assessment of the overall financial implications. Teaching unions and local government are consulted formally on the proposals.
Local government leaders set out the financial pressures facing local government, including those that arise from changes to public sector pay and pensions, through the finance sub-group of the Partnership Council for Wales. These discussions feed into the Welsh Government’s budget-setting process and inform decisions around funding priorities across Ministerial portfolios.
We are still seeking a resolution over the £36m shortfall in funding to fully meet the pensions changes during 2019-20 and subsequent shortfall of £50m in 2020-21. The UK Government should fully meet any costs associated with the changes it introduces, consistent with the principles in the Statement of Funding Policy, to ensure vital funds are not diverted from frontline public services.
We will continue to seek early certainty from the UK Government about what future changes mean for public sector organisations to enable them to plan ahead.