Rural councils say new funding plan falls short
Northumberland County CouncilRural councillors have said government proposals to change how they are funded will fall short of dealing with financial pressures.
Last week the government revealed how much it would give local authorities over three years in the first multi-year settlement to be offered in a decade.
The Ministry of Housing, Communities and Local Government (MHCLG) said more money would go to places with the "greatest need", but councillors in County Durham and Northumberland said the plans would short-change their neighbourhoods.
MHCLG said it would "make available £508.6m in Core Spending Power for Northumberland County Council and £797m for Durham County Council by 2028-29".
In addition to council tax, local authorities get a large chunk of their money from government grants.
Council tax makes up about 28% of Northumberland County Council's annual budget while about 15% is from general government grants.
The government's new proposed grants are based on recalculating the way it targets this money.
Funding 'wiped out'
Durham County Council deputy leader Darren Grimes, from Reform UK, said under the new plans the council would get about £17m extra each year.
"In just one year, the cost of children's care in Durham alone has spiked by £20m," he said.
"A single statutory pressure has already wiped out their entire new annual funding."
Meanwhile, Conservative Northumberland County Council leader Glen Sanderson said although the proposals would lead to a "small cash increase" in its budget, it faced much higher cost pressures.
He also said a measure which took into account the unique challenges faced by rural counties in delivering services to remote areas had been removed from the funding formula, though he acknowledged this was not the case for adult social care.
Sanderson said moves such as the funding formula favoured London and other metropolitan areas at the expense of rural counties.
"I believe this raises serious questions about fairness in how funding to councils is allocated," he said.
MHCLG said it was accounting for the challenges faced by rural councils by including journey time adjustments and more accurate deprivation data.
It also said that it had increased the cap within the home-to-school transport formula from 20 miles (32km) to 50 miles (80km)
MCHLG said: "The government is absolutely committed to tackling the issues that matter to all communities, including rural areas."
The new funding is due to be finalised in early 2026.
