Cllr Martin Hill is the Leader of Lincolnshire County Council.
It’s no secret that local government has taken a much bigger “hit” than other parts of the public sector as successive Conservative-led Governments have rightly sought to eliminate the national deficit.
What is sometimes less well understood – not least in Whitehall – is the huge disparity within local government, which leaves some authorities far worse off than others. That is not just a major concern for the councils affected, as they struggle to fulfil their legal obligations and balance the books. It also has a direct effect on the lives of the residents they are elected to serve, who end up paying more council tax for fewer services. Clearly, that can’t be right.
What lies behind this, of course, is a local government funding formula that has been built up – layer upon layer, year after year – until we have created a system that virtually no-one understands. As the Government itself now accepts, it is time to have a complete rethink and move towards new arrangements that work – as far as possible – for everyone.
So what exactly is going wrong at the moment? And how is that affecting county councils, including Lincolnshire? Between 2015 and 2020, my council’s core funding will reduce by 35 per cent, compared with 28 per cent for the average urban, city, and metropolitan authority. London authorities will fare even better, losing just 22 per cent. Another set of figures, with individual residents at its heart, is even more striking. By the end of the decade, residents in counties will receive just £161 of core funding per head. Across England as a whole, they will get £266, rising to £459 in London.
As a result, county authorities have had to raise Council Tax to make up the shortfall. The average Band D property bill in 2017/18 is £1,662 in county areas, £132 higher than the national average. What’s more, none of this takes account of the huge cost of providing services – home care, home-to-school transport, pothole repairs, and more – across a huge rural area.
Furthermore it isn’t just a case of rurality, which really just describes the nature of the landscape. It’s actually more about sparsity, which defines the density and spread of the population. In simple terms, it is obviously far cheaper and quicker for a home carer to visit five properties in one urban street, than to travel miles between each client in the countryside. To put that in context, the costs of providing adult social care across Lincolnshire – a popular destination for older people to retire – are set to rise by £8 million over the next two years alone.
Yet this issue of rurality/sparsity has never been properly reflected in the funding settlements awarded to county councils, which is one of the reasons so many of us are calling for change.
I understand, too, that the labyrinthine nature of the system can even work unfairly as between urban authorities, with some doing much better than others when the local government finance cake is divided up. Of course, no-one is demanding that every authority should get exactly the same level of funding, or that we should move to a new system overnight, without any time to adjust. What I do think everyone across local government is starting to accept – or, at least, I hope they are – is that it’s time for change. On the road to achieving that change, the Government’s Fair Funding Review, which is now out for initial consultation, is a hugely important milestone, and one that I welcome.