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Funding for Local Authorities

I beg to move,

That this House has considered funding for local authorities.

I thank the Chairman of the Backbench Business Committee and the Committee for allowing us good time to debate this serious subject.

In the summer of 2012, the Secretary of State for Communities and Local Government recognised the penalty for rural authorities—that is, that the formula for allocating funds to local authorities disadvantaged those in rural areas—and improved the sparsity weighting for the formula for the local government financial settlement for 2013-14. That was the good news for rural authorities, and the Government must be commended for recognising that historical inequality and for seeking to improve the funding formula for local authorities to take into account the higher costs associated with delivering public services in rural areas. I fully support the Government in their stated aim.

However, the Government seemed to have a little wobble. The damping model that the Department chose to minimise the swing in funding for councils wiped out all the gains from the improved formula for rural authorities, and as a result their total funding actually fell faster than that of urban local authorities. I am not seeking to steal money from urban authorities; I seek a fair deal for rural authorities as well.

The Department allocated a further £8.5 million to the most sparsely populated authorities after the rural fair share campaign. MPs pressed the Department and made our case. However, that is still only a one-off grant for 2013-14, and it distributes the £8.5 million to 95 local authorities in amounts ranging from £649,000 to £856,000. Is the Department considering ensuring that we have a little bit more money than that next year? In fact, I would like another £30 million at least. I probably cannot horse-trade too much, but it must be recognised that the rural authorities are not getting their fare share. Although welcome, the one-off grant makes no material change to funding disparities within the overall £22 billion settlement. That is a very big sum of money.