Tory MP blasts ‘injustice’ over rural funding

Rural areas are still suffering a serious “injustice” in the amount of money they receive for local services despite the Government’s claim to have overhauled council funding last year, a senior Conservative MP has warned.

Graham Stuart MP

Tory backbencher Graham Stuart, the MP for Beverley and Holderness and chair of the Commons education committee, said the coalition’s failure to address the shortfall in funding endured by councils in rural parts of the country is now “inexcusable”.

Mr Stuart has long campaigned for a fairer deal for rural councils, which he says receive around half the funding of their urban counterparts per head of population – a so-called “rural penalty” – due to the way Government funding formulas work.

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The issue has huge resonance for people living in market towns and villages across Yorkshire, where key services such as buses and mobile libraries have been slashed due to the huge cuts to council budgets delivered by the coalition since 2010.

Speaking in the Commons, Mr Stuart warned Ministers of growing unrest amongst Tory MPs in rural constituencies, and hinted a backbench rebellion may be in the offing if the issue is not addressed when the next round of council grants is agreed over the coming months.

“The rural penalty of 50 per cent more per head going to urban areas is just not right,” Mr Stuart said.

“As far as my office knows, 115 constituencies have Parliamentary petitions calling for a reduction in the rural penalty. Many colleagues... are strongly onside with that campaign. The patience, even of the most trusting and loyal people, can know a limit. We do not want it tested.”

Countryside campaigners complain that the Government’s current formula for funding local councils puts huge weighting on the severe deprivation found in some urban areas; but less on the higher costs of living in more remote areas and the need for rural councils to support a greater proportion of elderly people.

Mr Stuart said poverty can also be a serious issue in the countryside – meaning cuts to council services have an even greater impact.

“Average earnings in rural areas are lower, not higher,” he said. “It is a myth – there is no rural idyll.”

Last year, following a lengthy review, the Government at last said it accepted the case for increasing the funding for rural councils. But the final outcome in last December’s finance settlement for local authorities offered rural councils just a fraction of what had been hoped for.

Furthermore, the Government appeared to suggest the situation would not be revisited before the end of the decade.

“We cannot allow the freezing of that injustice and inequity until 2020,” Mr Stuart said.

His stance received support on the Opposition benches, with Labour’s new local government spokesman, Andy Sawford, promising to overhaul the funding formula if his party wins the next election.

“We will make the formula fairer,” he said. “The Government’s approach to local government funding needs to be seen for what it really is. It is unfair and it is unjust.”

The call for a fairer funding deal for rural councils has been rejected by both David Cameron and Nick Clegg over recent weeks, however. The Prime Minister said earlier this month: “We’ve had to make difficult decisions across the board. I think we’ve been fair between urban and rural areas.”

Nonetheless, Local Government Minister Brandon Lewis told Mr Stuart the Government is prepared to consider the matter during the crunch negotiations on council budgets in the weeks and months to come.

“I have heard the clear and passionate comments that have been made today,” he told the Commons. “We will consider them over the next few months as we approach the spending review.”