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Council Tax and Revenue Support Grant
31 January 2023
Lead MP
Chris Loder
Responding Minister
Lee Rowley
Tags
Social CareAgriculture & Rural AffairsLocal Government
Word Count: 6369
Other Contributors: 2
At a Glance
Chris Loder raised concerns about council tax and revenue support grant in Westminster Hall. A government minister responded.
Key Requests to Government:
The Government should reform the local government funding formula to provide a fair share of support to rural areas like West Dorset, especially after the impacts of the pandemic.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
Dorset residents pay over two and a half times more council tax than those in London. A third of the population is over 65, and services are largely funded by council tax with only minimal revenue support grant received compared to urban areas like Wandsworth (£654,000 vs £24 million). Dorset Council receives just 0.2% of total income from RSG, making it difficult for the elderly population and children's social care needs.
Jim Shannon
DUP
Strangford
Thanked the hon. Gentleman for his diligent work in representing his constituency, noting that councils are struggling to maintain basic service-level provision due to rising costs and called on the Government to consider increasing grants across the UK.
Sarah Owen
Lab
Luton North
Local communities are facing the strain of rising costs and declining neighbourhoods due to council tax hikes. Core funding for councils has decreased by £16 billion since 2010, while council tax has increased by over £15 billion. Labour would move towards longer-term funding settlements for councils to better plan for the future.
Government Response
Lee Rowley
Government Response
It is a pleasure to serve under the chairmanship of Sir Mark. My hon. Friend the Member for West Dorset (Chris Loder) has outlined important points affecting his constituency and the unitary authority, emphasizing the importance of rural Britain being heard in debates. The Revenue Support Grant (RSG) has been in place since the late 1980s but its utility and application have changed over recent years due to shifts in local government funding landscapes. The provisional local government finance settlement announced before Christmas includes a significant increase, with £60 billion-worth of taxpayer subsidy allocated for England, representing a substantial uplift across all councils. Additional clarity has been provided about what is likely to come in the financial year 2024-25, addressing long-standing requests from the sector. A one-off funding guarantee was also introduced, ensuring that individual councils could obtain some uplift prior to deciding on council tax adjustments.
The minister acknowledges the significant challenges faced by children's services and adult social care but highlights increased funding through grants like the social care grant and the discharge fund. The market sustainability and improvement fund is due to come in for the next financial year, aiming to support additional social care provision within individual localities. Concerning rural funding, councils with a significant proportion of rurality have received additional funds through the rural services grant over recent years, which will continue into the coming years.
The minister addresses perceived differences in how different parts of the country allocate resources and highlights that while London and other urban areas face distinct challenges, so do rural areas. The funding formulas reflect need irrespective of rurality. Acknowledging that there are different pressures and choices made in various geographical areas, the minister notes ongoing efforts to update needs assessments and funding formulas as part of a fair funding review. Despite these complexities, significant increases in funding have been provided this year through both revenue and capital grants, including allocations from the community renewal fund and the UK shared prosperity fund.
The Minister concludes by emphasizing that while challenges remain, prioritizing stability for local authorities after the post-covid period is crucial. He welcomes ongoing discussions on potential improvements and changes to better support all parts of Britain.
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About Westminster Hall Debates
Westminster Hall debates are a chance for MPs to raise important issues affecting their constituents and get a response from a government minister. Unlike Prime Minister's Questions, these debates are more in-depth and collaborative. The MP who secured the debate speaks first, other MPs can contribute, and a minister responds with the government's position.