Caerphilly County Borough Council faces a £33 million hole in its finances for the coming financial year, new research has found.

UNISON's study, released on Tuesday, highlights a collective shortfall of £326.7 million in council finances across Wales.

The national report, titled Councils on the Brink, says failure to address the growing problem could result in "the widespread collapse of local government".

The union warned significant cuts to essential services and jobs are likely as a result.

Local authorities in Wales may have to sell land, buildings, and other capital assets, and further reduce community services like rubbish collection, recycling, libraries, public toilets, and leisure centres, according to UNISON.

The research identified Cardiff Council, Caerphilly County Borough Council, and Swansea Council as the three Welsh councils with the biggest predicted shortfalls for 2025/26, amounting to £44.3 million, £33.7 million, and £28.5 million respectively.

The funding gap is the difference between each council's income and the amount needed to maintain promised service levels.

Caerphilly County Borough Council is looking to save £45 million over the next two years by closing venues such as the Blackwood Miners’ Institute and living history museum Llancaiach Fawr.

The authority is also considering axing its Meals Direct service, which currently provides fresh meals to more than 300 elderly people, including some who are blind and bed-bound.

Its funding gap for 2025/26 represents 7.3 per cent of its £457.6m annual revenue budget.

Elsewhere, Rhondda Cynon Taff Council made the decision to entirely privatise care in the region last October, and on Thursday, September 12, Neath Port Talbot Council will meet to discuss the future of leisure as it considers outsourcing services.

UNISON Cymru/Wales regional secretary, Jess Turner, said: "Councils are teetering on the brink of financial disaster.

"Countless essential services and very many vital jobs are at risk, with terrible consequences for communities across Wales.

"After 14 years of ruthless austerity, the very fabric of local society is under threat.

"Councils are quite simply the linchpin of local areas, so when services go, many people are left vulnerable, with no one to pick up the pieces.

“Local authorities were clobbered by the Westminster government, whose harsh financial settlements left councils with no option but to sell off the family silver, auction off green spaces, close key community facilities and let thousands of workers go.

"Only swift and decisive action to stabilise local finances will do."

Without urgent government support, UNISON warns the combined funding shortfall across England, Scotland, and Wales could reach £8.5 billion by 2026/27.

UNISON's figures, based on freedom of information requests and councils' own financial forecasts, present a bleaker picture than other estimates.

Ms Turner added: “Labour has inherited a mess, with essential services battered and bruised.

"The new government in Westminster understands the value of healthy public services and the role they can play in generating economic growth, in a way its predecessors simply didn’t.

"So as tough as the financial situation may be, ministers cannot ignore the terrible plight of authorities of every political persuasion.

"There’s an unquestionable need to turn the page on the destructive cuts of the past and invest in services and staff to help councils rebuild Britain."