Funding system ‘hampers counties’ social mobility efforts’

31 Oct 18

Shire counties have been “hamstrung” in their efforts to improve social mobility due to “outdated” funding methods that favour cities over rural areas.

The government must do away with perceptions of rural counties as affluent places and distribute more funds in their direction to target “hidden deprivation”, the County All-Party Parliamentary Group and the County Councils Network has urged.

Councils in London receive £482 per head, whilst metropolitan boroughs and cities get £351, but county areas get just £182 per person for public services, the report out today claimed.

Peter Aldous, Conservative MP for Waveney and chair of the County APPG, said: “An outdated and inequitable method of funding local authorities has disproportionately channelled funding towards London and the major cities; holding back social mobility in county areas, and embedding a cycle of low life chances for residents. This is unfair.

“Funding is only part of the answer; today’s report showcases the innovative work county authorities are doing to raise social mobility in their areas, but their ambitions are hamstrung.”

Aldous said fair and sustainable funding for counties would bridge the social mobility divide between urban and rural areas.

The report includes a ‘social mobility index’ produced by the think-tank Localis, which found that among the ten least socially mobile rural areas were Devon, Kent, Cumbria and Durham.

Jonathan Werran, chief executive of Localis, said: “Our research for the commission shows young people in London are pulling away from the rest of the country in opportunity and educational outcomes as soon as they enter school.

“Young people growing up in coastal and rural areas of England are then further constrained by poor skills infrastructure and in many cases weak prospects for finding good local jobs that pay decent wages.”

The report recommended that the government devolve skills budgets and powers.

The Ministry of Housing, Communities and Local Government is currently consulting on the fair funding review, which will aim to set a new baseline funding allocation for local authorities by taking into account their relative needs.

This should be underpinned by “genuine cost drivers and, where possible, a distribution of funding that can respond to the growth in social care pressures in county authorities”, the report said.

Councillors previously expressed their reservations about the fair funding review, at the Labour Party conference in September.

CIPFA and the Institute for Fiscal Studies hosted a round table discussion on the fair funding review and the issues arising from it in September.

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