Gwynedd residents could face a council tax increase of 8.66 per cent.

Proposals to increase the rate was approved in principal at an 11 February Cabinet meeting. Approval was also given to plans to set a budget of £355,243,800 for 2025/26, funded by £246,818,190 of government grant cash and £108,425,610 of council tax income – an increase of 8.66 per cent.

A capital programme of £53,736,190 in 2025/26 was also approved.

The council also formally approved savings proposals to the value of £519,000.

Cabinet members will be asked to recommend the figures for the final budget decision at Full Council on 6 March.

A report stated: “The 2025/26 budget seeks to protect the services the council provides and recommends an 8.66 per cent increase in Council Tax to achieve that objective this year.

“Even then, we will need to look for savings and cuts to set a balanced budget, and forecasts suggest there will be further pressure in aiming to set a balanced budget for 2026/27.”

In setting its balanced budget for 2025/26, a report stated the budget is being set “at a time when Welsh local authorities continue to face financial challenges, where the addition to the [government funding] settlement does not meet the increase in demand for services”.

It added: “Cyngor Gwynedd has received a grant increase for 2025/26 of 3.2 per cent, equivalent to a £7.5m increase in external funding.

“In addition, a further £6.5m has been included to reflect the transfer of responsibilities to the settlement, which is also included in the grant.

“By 2025/26, our spending would need to be increased by £24.2m to ‘stand still’.”

This included £7.7m to meet pressures on service budgets.

The report added: “It is seen in this report that demand pressures on services, as well as inflationary pressures indicate that a combination of council tax increases and the introduction of a new programme of savings and cuts must be considered if a balanced budget is to be set for 2025/26.”

And considering its long term strategy the council report stated: “When announcing the draft 2025/26 settlement in December 2024, the Welsh Government has not given an indication of the increase in grant that will be paid to Welsh local authorities from 2026/27.

“However, the outlook is not positive, and Cyngor Gwynedd, like all other councils, is expected to receive below-inflation increases in future – and perhaps no increase at all.

“In considering the increased demand for services on the council, in the face of shrinking provision because of cuts, there will need to be an early, fundamental consideration of what the council can provide and how.

“Further saving plans have been programmed for 2026/27 and beyond but work will commence immediately after setting the budget for 2025/26 on updating a MediumTerm Financial Plan that recognises the situation as envisaged.”