A Council spokesperson said: "Cardiff Council is a proud supporter of the Pride Cymru event and has been from its very beginnings.

"Last year - the festival had to be moved to the Civic Centre from its regular home in Bute Park because of the UEFA Champions League Final and we did our utmost to work with organisers to keep costs as low as possible setting aside substantial parking revenue losses in the process.

"We were very aware it was the 50th anniversary of the 1967 Sexual Offences Act and that Pride Cymru were bidding to host UK Pride and Euro Pride. Consequently, we were determined to work with the organisers to show Cardiff at its very best.

"However, we were always clear that last year's event was a one-off in terms of the council being able to subsidise the festival to the same level. We are still subsidising the festival this year though and we have offered the organisers the use of City Hall Lawns and Alexandra Gardens free of charge, but we do need to negotiate the losses to car parking revenue that the festival will cost us.

"The organisers have made the decision that they want the event around the Civic Centre again. Unfortunately this decision has clear cost implications. For example, road closures could see a loss of many thousands of pounds in parking revenues. The size of the festival and the number of days it takes to set up, run and take down will all clearly impact on these costs. The figure the organisers are quoting is based on their initial requirements, but it also includes arrangements around the Parade and the majority of the cost is made up of those parking revenue losses.

"A festival with a big footprint, taking up more space over more days will clearly have higher cost implications. We are currently talking through these costs with the organisers looking at ways they can be reduced.

"This Council is facing a £91m budget gap over the next three years on top of £145m in savings made over the past five years, so we are in a really difficult position when it comes to funding or accepting losses on events of this scale and it would be unfair, in this context, to treat one organisation any differently to another.

"However, we are committed to making the festival a success and there are several options on the table to help try and reduce event costs. We are more than happy to continue our discussions with Pride Cymru to find a way forward which is workable for both parties."