Wiltshire Council has raised serious concerns about proposals to reform the distribution of local authority funding, warning that it could leave the county millions of pounds worse off.
The council’s Cabinet discussed its response to a consultation on the Local Government Settlement Grant. Early modelling suggests that Wiltshire could lose more than £4 million over the next three years, with the largest reductions occurring in the first two years.
The final figures will be announced in December, ahead of the budget being finalised in the spring.
The Government is planning to reintroduce a three-year settlement grant to help local authorities plan. However, they also want to reform the system so that the most significant grants are directed to areas that are most in need. As it stands, more affluent councils will lose money, including Wiltshire.
The council states that while it supports the principle of modernising the funding system, the Government’s eight-week consultation, which spans more than 100 pages and includes 46 detailed questions, does not provide worked examples of the financial impact.
This lack of clarity makes it difficult for councils to properly assess the implications.
Wiltshire Council is also critical of the use of assumed 5% council tax increases and a 100% collection rate to calculate funding, arguing that these assumptions are unrealistic, unfair, and could affect the level of government grants received.
Cllr Gavin Grant, Cabinet Member for Finance at Wiltshire Council, said a multi-year settlement would help them to plan with more certainty, but wanted the Government to think again about its funding formulas.
“The current proposals lack transparency and potentially risk placing Wiltshire Council in a more difficult and detrimental financial position,” he said.
“It is almost impossible to fully assess the implications of these detailed proposals with the limited information provided, although it is apparent that the Government are not adequately reflecting the cost of delivering services in rural locations and focusing funding more on their measures of deprivation.”
Cllr Grant felt that the proposals came at a time when all councils are under immense pressure, particularly in areas such as social care and Special Educational Needs & Disabilities.
“It is also unrealistic of the Government to expect councils to provide vital services such as social care, while receiving below average funding increases over the next three years and ultimately reductions in Government grant funding,” he continued.
“Without more detail, it is very difficult for us to understand the true impact of these proposals. It is likely we won’t know until the provisional local government finance settlement is announced.
“We urge the Government to carefully consider the feedback it receives and ensure the final settlement is fair and appropriate for rural councils like Wiltshire. Meanwhile, we will continue to advocate for a fairer, evidence-based funding system that reflects the needs and responsibilities of local authorities.”
