A COUNCIL tax rise of 5.5% could be on the way for Vale of Glamorgan residents next year.

As part of its initial budget proposals, Vale of Glamorgan Council is modelling a 5.5% increase for 2026/2027 which equates to an extra £1.75 a week for a Band D property.

A report to cabinet on Thursday, 15 January will recommend the council consults on draft budget proposals which show that there is a funding gap of £6.58m in 2026/27 and £34.86m across the five year medium term which will be met from a mix of reshaping and savings.

Reshaping is described as a strand of work that reduces spending by operating services differently.

For 2026/27, £3.81m of the gap is met from the reduction in pension costs with £2.77m coming from "reshaping" and savings.

The report says an increasing proportion of the council's resources year on year have been taken up by schools and social care. This was 68% in 2023/24, 70% in 2024/25 and rose to 71% for 2025/26.

But this trend is paused in 2026/27 due in large part to the reduction in employer pension contributions.

For 2026/27 the council is faced with financial pressures of £27.72m and these total £83.91m across the medium term (including 2026/27).

In total, the council's draft budget for 2026/27 is worth £354m which will go on things like schools, social care, highways, housing, waste and recycling services and looking after parks and outdoor spaces.

The latest Welsh Government funding announcement in December gave an improved settlement of 4.5% across Wales, an improvement on the 2.5% in the initial provisional settlement in November.

But the Vale cabinet report states: "However, the additional resources whilst appreciated continue to fall short of what is needed to sustain essential local services.

"The settlement concentrates resources towards schools and social care.

"It is also underpinned by a notional increase in council tax based on the average across Wales for the past three years and that is in excess of the increase proposed in this report."

It adds that the overall position for the council has benefited from the significant funding position for the Cardiff and Vale Pension Fund with the proposed reduction in the employers' contribution reducing costs by £3.81m.

The report says: "The improved settlement and reduced pensions costs have enabled a further review of cost pressures enabling additional resources to be targeted at schools, addressing continued social care pressures and putting measures in place to make the council more financially resilient across the medium term.

"It has also allowed a budget to be proposed that does not require significant cuts to other services."

The report says that while the settlement was better than anticipated it does fall short of the resource required to meet the growing ALN (additional learning needs) and social care demands and the pressure of the national insurance increases in the chancellor's budget on externally provided service provision.

Cllr Lis Burnett

Cllr Lis Burnett, the Labour leader of the Vale of Glamorgan Council, said: "I'm pleased to say that for the first time in a long while our funding has increased in real teams compared to last year.

"That is not to say that recent financial challenges are behind us. The council still has significant costs to meet brought on by more than 10 years of below inflation funding.

"However, a welcome funding announcement from Welsh Government and hard work from staff to transform the way services are delivered in many areas means we are in a healthier position than we might have been.

"This council does not want to make cuts, there are services in the Vale that urgently need more investment. After an extended period of significant savings and cutbacks, I'm optimistic we can now provide that and start moving forwards.

"That means focusing on the priorities set out in our five-year-plan. We want to create great places to live work and visit, protect our natural environment and give our children the best start by supporting their health, social and educational development.

"We want to provide the best possible care to vulnerable residents and perform to our maximum by constantly reviewing and improving how services operate.

"I know that these ambitions are shared by our residents because they have told us so.

"The draft budget contains a council tax increase that is modest by national standards and will help address these priorities.

"Of course, a greater rise would help achieve more as money gathered from council tax directly affects what we are able to do.

"One of the questions within the consultation asks whether residents would be willing to pay more council tax to see improvements to the likes of rural transport links, youth provision and open spaces. I'm very interested to hear feedback on that."

Andrew RT Davies

But Conservative South Wales Central Senedd member Andrew RT Davies said: "Plaid Cymru separatists and Labour both demanded an increase in welfare spending, for which Vale workers are paying the price.

"This also has consequences for local services. Residents are facing a council tax rise far higher than inflation, which the council claims is needed thanks to National Insurance rises.

"Plaid and Labour both insisted the two-child benefit cap had to go. Taxes are going up to pay for it, and this is impacting our whole economy.

"The council must also take responsibility for the inappropriate projects it prioritises.

"Putting resources towards a County of Sanctuary for asylum seekers and funding Stonewall diverts them from frontline services, placing further pressures on budgets."

Plaid Cymru councillor Ian Johnson

Plaid Cymru councillor Ian Johnson said: "Plaid Cymru secured an additional £4.6m for the Vale of Glamorgan Council through the Welsh Government budget debate in December, so it is disappointing that Labour are still suggesting a 5.5% council tax increase, well above inflation.

"As a responsible and constructive opposition, we will be scrutinising the budget over the next few weeks to see where we can stop increased costs, as well as protecting services from cuts.

"However, it's important to recognise that many of the increased cost pressures faced by the council come from providing support to the most vulnerable, either Additional Learning Needs support in schools or social care for older people in our society."

Residents can take part in the upcoming consultation which is set to run for four weeks from January 16 either online, by telephone, post or at an in-person event.

The draft budget will also be considered by a joint scrutiny committee and again by cabinet before going before a meeting of full council in March.