A GWENT authority plans to create a £1 million contingency fund to deal with the potential impacts of Brexit.

Caerphilly's local economy, and the council’s supply chain, could be disrupted if the UK leaves the European Union without a deal, according to a report.

Concerns have been raised about a possible lack of inward investment in the longer term, with a rise in prices for goods and services potentially affecting smaller businesses.

But the council says with “so much outside our control”, no-deal preparations have proven difficult with uncertainty surrounding the Withdrawal Agreement tabled by prime minister Theresa May.

“It is impossible to mitigate many of the risks without greater clarity on the actions to be taken by the UK and Welsh Governments,” the report says.

A vote on Theresa May's unpopular Brexit deal is due in the coming weeks

The proposed Brexit fund, which could be approved by cabinet on January 16, would be drawn from £20.8 million in unallocated reserves.

READ MORE: Brexit: the past seven days

Similar arrangements will be discussed by Blaenau Gwent council’s corporate and overview scrutiny committee on January 23.

Businesses will be asked about their own concerns and preparations for exiting the EU, while officers are also being briefed on the introduction of the EU Settlement Scheme in the borough.

A report says there are 582 non-UK, non-Irish EU citizens living in Blaenau Gwent, with the figure expecting to rise once children under-18 and adults not registered to vote are considered.

Blaenau Gwent council offices

Information for those who need to apply for the scheme, which opens in March, will also be provided on the council’s website.

Work will also be done to monitor community cohesion and any tensions arising towards EU residents or in the event of a second EU referendum in a high leave-voting area.

Local authorities in Wales have been issued with a ‘Brexit preparedness toolkit’ by the Welsh Local Government Association (WLGA).

Torfaen and Monmouthshire council leaders Anthony Hunt and Peter Fox sit on a committee which oversees the WLGA’s Brexit work.

The document says: “While the outcome of Brexit negotiations remains uncertain, it is essential for councils to set a path to ensure the continued delivery of vital services and the best possible outcomes for their local communities and economies.”

Wales currently takes more funding from than the EU than its taxpayers put in, receiving around £680 million each year.

Organisations will be unable to access EU funding after any agreed transition period but if the UK leaves without a deal, the Treasury has ensured to fund projects approved before the end of 2020.

EU funding would be replaced by the UK Government’s Shared Prosperity Fund from January 2021.