MONMOUTHSHIRE Council is in a “grave situation” financially, the authority's leader has said.

Addressing the full council, Cllr Peter Fox said that the current financial situation, which has been exacerbated by the coronavirus pandemic, has caused him anxiety.

He said: “This is a grave situation we are in financially

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“I think, in my 23 years here in Monmouthshire County Council, I don’t think I’ve ever experienced a position that has caused me so much anxiety as this one does now.

“And that’s a position shared by leaders from all across Wales, some in more precarious positions than others.

“My grave concern is that the pressures we’ve identified, not all of them will be refunded and that will leave us in a very very difficult situation.

“This is a serious situation; I hope all members recognise the gravity of the position we are in.”

Cllr Fox said that the local authority had “very limited reserves” compared to other areas of Wales.

The leader of the council’s Labour group Cllr Dimitri Batrouni said he accepted that the council is in a “desperately bad position” financially but said the Conservative group had mismanaged the council’s reserves.

Cllr Batrouni said: “They much maligned other councils for having big reserves and you can argue they were saving them for a rainy day and the rainy day has arrived.

“The other councils are more prepared than us because we just wasted those reserves away, or didn’t think it was prudent enough to boost our reserves.”

Cllr Giles Howard said there was a very good reason the council’s reserves are so low.

Cllr Howard referred to the local government settlement that Welsh councils receive from the Welsh Government annually. This year, Monmouthshire saw the smallest increase across the 22 councils in Wales.

A report into the effects of the coronavirus pandemic on the council’s finances showed that Monmouthshire has usable earmarked reserves of £5.4 million.

Councils have statutory requirement to balance their budgets, if they believe they will be unable to do so they are obliged to issue a section 114 notice.

However, the report says the council does not consider this necessary at this time.