Monday, 21 December 2015 08:16

Government increases rural grant

Written by  Ruralcity Media
Government increases rural grant

THE government's latest funding settlement has increased the grant to local authorities that deliver rural services – but only in the most sparsely populated areas.

Local government secretary Greg Clark announced the government's provisional funding settlement on Thursday (17 December).

It increases the amount of the Rural Services Delivery grant from £15.5m to £65m in 2019-2020.

The Rural Services Network and the Rural Fair Share group of MPs hace long been campaigning for a fairer share of government funding for rural communities.

    See also: Government urged to honour fairer funding promise

Urban areas currently receive on average 45% more funding per resident than rural areas.

Mr Clark said the extra cost of providing services in the most sparsely populated of areas would be recognised through a rising Rural Services Delivery grant.

"Some district councils – those with low Council Tax bases or which serve the most rural areas – face particular pressures," he said.

"So while this settlement maintains the core referendum threshold at 2%, the threshold for the lowest cost district councils will be £5 a year."

This would ensure district councils weren't punished for being economical while those who have spent more in the past were allowed to spend more now.

Mr Clark added: "I will increase support for the most sparsely populated rural areas by more than quadrupling the Rural Services Delivery Grant from £15.5 million this year to £65 million in 2019 to 2020.

By this time, when 100% business rate retention has been achieved, the government could consider what further correction is due, he said.

Graham Stuart MP, who chairs the Rural Fair Share campaign, welcomed the increase in the Rural Services Delivery Grant but said it was a shame more money was not available.

"The increase in the Rural Services Delivery Grant is good news.

"It's the most significant increase we've seen yet, and I'm grateful to the Secretary of State for listening to the concerns of rural MPs from all sides of the House.

"I am pleased that he recognises the unfairness of the current system, which sees poorer, older, and more heavily taxed rural residents receive fewer local government services.

"It's disappointing that the government hasn't committed to the full £130m which our campaign has asked for, and that next year's increase will only see the grant increased to £20m.

"There's a long way to go yet, and we will be campaigning to improve the deal further before the vote in the House of Commons in February."

Mr Clark described Mr Stuart as a "persistent and effective campaigner" who had drawn attention to the special costs that the most sparse rural authorities face in providing services.

Mr Clark said: "We have gone a long way, based on the evidence we have seen, to address those needs.

He added: "I and my colleagues will be happy to meet my honourable friend and other colleagues to discuss how it will work out in practice."

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