Commons Sense

House of Commons · Ministers' Questions

Local Authority Funding

Monday 9 June 2025 · 5 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 0 Partly answered 4 Not answered 0

Key points

  • Amanda Hack inquired about fair funding for Leicestershire and other authorities facing cuts to vital services.
  • Natasha Irons raised concerns about Croydon council's financial struggles despite increased council tax and service cuts.
  • Terry Jermy questioned whether Government support for local councils in rural areas adequately addresses isolated deprivation.

Topics (select to filter)

Questions & Answers

Q1 Amanda Hack Lab North West Leicestershire
Local Government
Context

Leicestershire has been campaigning for fair funding, following 14 years of poor funding settlements by the previous government which led to cuts in services and low levels of school funding.

Question

Leicestershire, alongside other authorities, has been campaigning for fair funding in recent years, following 14 years of poor funding settlements by the last Government, meaning cuts to vital services. A lack of fair funding also means that schools in North West Leicestershire have some of the lowest levels of funding per student in the country. How will the Minister approach a fair funding settlement that considers the unique challenges faced by rural communities?

Answer from The Minister for Local Government and English Devolution (Jim McMahon)

I thank my hon. Friend for her work in championing those issues. We are fundamentally reforming how we assess councils’ relative needs and resources, to ensure that funding is distributed to where it is needed most. That includes accounting for councils’ ability to raise resources locally, which the previous Government promised to do but ultimately failed to do in balancing the numbers. Targeting funding in that way will enable councils that have had to scale back services the most to be able to catch up and to ensure that everybody, across the whole of England, is able to access decent public services.

Partly answered

Not addressed: The Minister did not provide specific details on how rural communities would benefit from the funding settlement beyond general reform statements.

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Q2 Natasha Irons Lab Croydon East
Local Government
Context

Croydon council's finances remain unstable despite a significant increase in council tax and additional financial support. The borough faces complex challenges due to its status as an outer-London borough with inner-London problems.

Question

Despite an increase in council tax of 27% since 2022, £136 million in exceptional financial support this year and brutal cuts to services, Croydon council’s finances remain broken. As an outer-London borough with inner-London problems, Croydon has historically not received the funding it needs to cover the costs for demand-led services like temporary accommodation, so even if Croydon’s debt was wiped out, it would still need exceptional financial support. Will the Minister outline how councils like Croydon will get the resources they need to meet the complex challenges they face and provide the frontline services that our communities deserve?

Answer from The Minister for Local Government and English Devolution (Jim McMahon)

The questions that have been raised demonstrate why the fair funding review is needed, and why it has to take into account all the different factors that have an impact on whether councils can provide good public services or not. I appreciate, understand and accept that pressures that were previously felt in inner London are now felt in outer London, and in rural areas too. My hon. Friend will know that in February we provided £136 million in EFS support for Croydon council, and we will continue to work with it. We have met and talked about the issues a number of times, and I know that she understands that those are not small problems to deal with.

Partly answered

Not addressed: The Minister did not provide specific details on how Croydon would receive adequate funding but assured continued support.

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Q3 Terry Jermy Lab South West Norfolk
Agriculture & Rural Affairs Local Government
Context

Pockets of deprivation in rural areas are often masked by more affluent surroundings, making it difficult for these areas to receive adequate funding.

Question

Pockets of deprivation in many rural communities, like my South West Norfolk constituency, are often masked by more affluent surroundings. Will the Minister reassure me that financial support from the Government for local councils in rural areas reflects those concerns about isolated deprivation?

Answer from The Minister for Local Government and English Devolution (Jim McMahon)

This month, we are consulting on an updated assessment of need that we will implement from 2026-27. Importantly, that includes the indices of multiple deprivation, a designated national statistic, and it will drill down to deprivation levels of between 400 and 1,200 households in each of those units. Our intention is to address the issues found in the pockets of deprivation in every community, including rural and coastal communities where they are sometimes drowned out because of the sea of affluence around them. It is important that we get to deprivation wherever it exists.

Partly answered

Not addressed: The Minister provided an overview but did not confirm specific measures for addressing isolated deprivation in rural areas beyond consulting on needs assessment updates.

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Q4 Ayoub Khan Ind Birmingham Perry Barr
Employment Local Government Environment
Context

Reports indicate that bin strikes in Birmingham may last until December, raising concerns about the adequacy of funding provided by the government to address this issue.

Question

It has been reported that the Birmingham bin strikes may last until December. How can this Government claim to support workers when they refuse to fund Birmingham city council properly? This dispute boils down to cash, yet the Government are failing Birmingham’s bin workers, residents and businesses. The Government backed our steelworkers. Will they back the bin workers with extra funding?

Answer from Jim McMahon

I hear what the hon. Gentleman says. On the calls that we have with MPs when we update them on these issues, his tone is quite different. We need to separate the rhetoric from the reality. The reality is that for the first time we had £600 million in the recovery grant, which was about those councils suffering high deprivation and historically low tax bases. Birmingham was the biggest beneficiary of that, receiving nearly £40 million.

Partly answered

Not addressed: The issue of bin strikes and their funding has not been directly addressed; instead, emphasis is placed on previous funding allocations.

How: Separate Rhetoric From Reality, Reference To Recovery Grant

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Q5 David Simmonds Con Ruislip, Northwood and Pinner
Asylum & Refugees Local Government
Context

Local authorities are facing increasing pressure due to the influx of asylum seekers from various government policies. This has led to financial strain on council budgets.

Question

The Minister knows from his time at the Local Government Association of the impact that asylum has on the budgets of local authorities. With the Home Office’s much-vaunted increase in the grant rate for asylum claims, the Government are pushing thousands of households on to council waiting lists and shunting millions in costs on to council tax payers. What additional funding and measures does he aim to secure to help to mitigate those costs, which are affecting so many of our local authorities?

Answer from Jim McMahon

Quite frankly, it is a bit rich for any shadow Minister to critique the current system when the Conservatives deliberately designed it in their 14 years in government. The question is how we go about repairing it. One thing must absolutely be put right; the disjointed system in which different Government Departments work in silos cannot carry on. One of the successes of the leaders’ council is that for, the first time ever, local government leaders are around the table with the Government, including in a meeting with the Home Office and our Department, to work through exactly those issues. That is the change: for the first time, those in local government are being treated as adults.

Not addressed: The question about additional funding has not been addressed; instead, the response criticizes previous governments and discusses a new system of cooperation between departments.

How: Critique Of Previous Conservative Government, New System Involving Local Government Leaders

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