Fair funding for Cornwall Council

My article in next week’s Cornish Guardian will focus on the need for fair funding for local government in Cornwall. It will be as follows:

At this month’s meeting of Cornwall Council, I was one of the co-signatories to a cross-party motion seeking fair funding for the unitary authority.

The motion noted the “severe cuts to funding for local councils from central government, together with practical constraints imposed on the ability of councils to raise levels of council tax,” which it stated was impeding “local councils from carrying out their responsibilities” in the manner that they would wish.

The motion also observed that the “current funding formula used by the Government is imbalanced and underfunds rural authorities in comparison with urban councils.” It pledged that Cornwall Council would “take all reasonable steps to make central government aware of the real hardships” that its actions are causing to local communities.

There was near unanimous support for the motion, which is unsurprising, given the stark financial situation facing Cornwall Council and other local authorities.

Cornwall Council has already had to agree cuts of £43 million for 2014/15 because of “central government funding cuts, inflationary cost pressures and unavoidable service pressures.” Further cuts of £62 million are anticipated in 2015/16, with cuts of £109 million for the period 2016/17 to 2018/19.

Research from LG Futures (Costs of Providing Services in Rural Areas) meanwhile demonstrates that the “cost of providing services in a rural area is greater than … in an urban area.”

It also concluded that “there is a substantial cost penalty faced by rural authorities in providing services and that the provision for sparsity – costs associated with rural areas – within the government funding formulae is significantly lower than the actual cost.”

And yet, central government continues to allocate more money to urban authorities (£487 per head) than rural ones (£409 per head).

Cornwall Council recently reported that, if it was “funded at the same per capita basis as the average urban authority,” its annual funding would be £42 million higher.

And it that wasn’t bad enough, research also demonstrates that people living in rural areas still have less access to services.

Central government also included what it terms a “floor damping” reduction in its recent financial settlement. This measure ensures that “there are no significant funding increases/decreases for individual local authorities when changes to grant funding mechanisms are made.”

Cornwall Council has worked out that, because of this “damping,” it will get “£9.4 million less than the Government’s own calculations indicated was due.” It has also discovered that this unfair measure has been locked into the Government’s funding mechanism for the next ten years!