This report provides an overview of the extent to which councils in Wales are responding to the financial pressures they face. It explores the effectiveness of their financial planning, their approach to financial decision making and the actions they are taking to minimise the impact of significant budget cuts. It also considers the extent to which councils understand the impact of their actions and provides some early thoughts on the implications of the 2013 Spending Review for local government in Wales.
Overall, we conclude that many councils in Wales do not have clear and realistic plans to deliver efficiency savings and do not routinely base their strategic plans on sound financial information. Although not all councils are effectively monitoring and evaluating the delivery of their strategic plans, they have been able to meet their financial challenges – but cracks are beginning to show. As financial pressures continue to grow, councils will be increasingly reliant on having robust and appropriate arrangements in place.