Rural councils fear losing million of pounds in social care funding, government warned

In the Budget, Ms Reeves, the Chancellor, announced £1.3 billion of funding to local authorities. Of that, £600 million was earmarked for social care, with the rest allocated by deprivation.

However, at the CCN’s annual conference yesterday, chairman Coun Tim Oliver warned that if local authorities have to pick up the bill for the increase in national living wage and employers’ national insurance contributions, then that cash injection will do “very little” to bridge the funding gap facing town halls.

North Yorkshire Council leader Coun Carl Les previously told The Yorkshire Post that transporting one child with complex needs to school was costing £1.2 million a year.

Coun Oliver explained that for CCN members - like North Yorkshire and the East Riding - the situation could potentially get worse because of the way the government intends to distribute the resources.

New analysis suggests that social care authorities in county and rural areas may receive hundreds of millions less in funding, due to the government allocating £700m by deprivation.

Modelling for CCN has found this would reduce its members allocation by a third, which equates to around £190m.

Coun Oliver said: “While deprivation is an important indicator of need, it is not the main driver of councils’ unsustainable rise in costs, nor the key measure of who is under the most financial distress.

“Whether it’s the acute rise in children’s placement fees, care for working age adults, or escalating spend on special education needs and disabilities (Send) home to school transport, it is demand and market failure that is pushing councils of all shapes, sizes and political control to the brink.”

A report from the Local Government Association found that one in four councils in England say they will have to apply for an emergency government bailout over the next two years to stave off bankruptcy.

The CCN has said that using the social grant is a fairer way to fund councils, which still gives urban boroughs more resources per head.

Labour has pledged to give councils multi-year funding settlements to provide greater stability.

In one of her first interviews in power, Ms Reeves told this paper: “One of the big challenges that local authority leaders and councillors say to me is that they don’t know from one year to the next what their budget is going to be, so it’s very difficult to plan the future and get value for money.”

A government spokesperson added: “We have inherited a broken social care system and will work closely with the sector to build a National Care Service that will improve the quality of care for working-age disabled adults across the country.

“The Chancellor has announced at least £600 million of new social care funding, as well as an £86 million increase for the Disabled Facilities Grant, which are part of a wider package to bolster support for councils.

“We are also committed to reforming Job Centres to provide better employment support and make health-related benefits more flexible – making it easier for people to move into paid work.”