08 Sep 2026
The challenges facing rural councils were placed firmly in the parliamentary spotlight during a Westminster Hall debate on government support for rural upper-tier local authorities.
Opening the debate, Helen Morgan MP warned of a widening gap in opportunity, social mobility and economic growth between rural and urban areas. Citing Rural Services Network analysis, she highlighted that urban councils will receive 32% more Government-funded spending per head than rural councils, while rural residents pay, on average, 17% more in council tax per head.
MPs from across the country described the additional pressures associated with delivering services across large and sparsely populated areas. These included longer travel times, ageing populations, limited public transport, hidden deprivation and the rising costs of social care, SEND provision and home-to-school transport.
Caroline Voaden MP spoke about how moving from a city to rural South Devon had changed her understanding of rural life. She argued that the rural–urban divide is too often overlooked and pointed to lower wages, poor connectivity and the loss of banks, post offices and other community services.
Responding for the Government, Local Government Minister Jim McMahon said that rural delivery costs were recognised through the area cost adjustment and additional provisions within individual funding formulas.
However, Caroline Voaden challenged how this could be reconciled with the removal of the Rural Services Delivery Grant and the resulting loss of around £14 million for Devon County Council.
Closing the debate, Helen Morgan expressed disappointment with the Minister’s response and stressed that the argument was not about pitting rural and urban areas against one another. Instead, she called for fair funding and meaningful devolution to give rural councils the capacity to deliver sustainable services and support economic growth.
The debate reinforced the importance of a funding system that recognises rural need, sparsity and the unavoidable additional cost of delivering essential services across rural communities.
The Rural Funding Picture
Rural Services Network analysis of the 2026–27 funding settlement shows that:
- Rural residents will pay 17% more in council tax per head than urban residents in 2026–27.
- Urban councils will receive 32% more Government-funded spending power per head than rural councils in 2026–27.
- By 2028–29, urban councils will have seen a 20% increase in Government-funded spending power, compared with only 2% for rural councils, using 2024–25 as the baseline.
Watch: Key Moments from the Debate
Below, we have brought together a series of short clips highlighting some of the key contributions made during the debate, from the rural funding gap and hidden deprivation to the additional cost of delivering services across sparsely populated areas.
The clips feature Helen Morgan MP, Caroline Voaden MP and John Milne MP.
Footage: UK Parliament
Helen Morgan MP: The Widening Rural Funding Gap
(58 seconds)
Caroline Voaden MP: Understanding the Reality of Rural Life
(1 minute, 20 seconds)
John Milne MP: Recognising Hidden Rural Deprivation
Caroline Voaden MP: Challenging the Minister on Rural Funding
Helen Morgan MP: The Funding Formula Overlooks Rural Costs
(43 seconds)
Helen Morgan MP: Rural Areas Need Fair Funding and Devolution
(49 seconds)
