County councils warn non-statutory services could end amid funding squeeze

18 Jan 16

The “unprecedented” reductions in funding for county councils set out in the local government finance settlement could "all but end" the provision of non-statutory services in some parts of the country, the County Councils Network has warned today.

In a response released following the closure of a consultation on the settlement, counties warned that changes to how local government funding is distributed could see funding cut by one third.

Local government secretary Greg Clark set out four-year funding deals for local authorities to allow councils to plan for full local business rates retention in 2020.

However, the CCN said changes to how local government funding is provided across the sector could mean that some counties will seed funding fall by 34% due to redistribution of funds to inner London and metropolitan authorities, increasing the cut faced by countries by £184m to £854m during 2016/17.

By contrast, metropolitan boroughs receive a funding increase of £95m during 2016/17, with inner London receiving £53m, according to CCN figures.

Under the current plans, rural county areas, which already receive 37% less funding that urban centres in the North, could receive 90% less government grant per head of population than met areas by the end of the parliament.

In its consultation response, the CCN called on the government to postpone the changes or provide emergency transitional funding to help mitigate the reductions in order to ensure some services to do not halt in 2016/17.

The group also called for the government to undertake a full needs-based review of funding, which the government has pledged before business rate localisation, within the next six months.

Failure to do so could embed unfairness in the funding system, CCN chair Paul Carter said and put discretionary services such as economic development work and leisure services at risk.

“Our evidence shows that counties see the biggest reduction in funding due to the changes being made in the distribution of local grants,” Carte stated.

“We are committed to making further efficiency savings to help the government’s deficit reduction plan, but these changes go too far and disproportionately impact our areas.”

The group also highlighted that county areas were the only group of authorities that saw an increase in social care referrals in the five-year period from 2009/10 to 2013/14.

According to an analysis by finance consultants LG Futures for the CCN, the number of referrals for social care, one measure of demand, grew in country areas by 8.5% over the five-year period 2009/10 to 2013/14. This was the only increase across types of local authority responsible for social care, with falls in referrals across London boroughs, metropolitan boroughs and other unitary councils.

“In conclusion, therefore, CCN members have experienced a significantly larger than average increase in demand for adult social care services over the five-year period, with a key factor in this increased demand being referrals from the health sector,” the report concluded.

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