Tories face heartland rebellion over ‘rural penalty’

Graham Stuart, the Tory MP for Beverley and Holderness, and chairman of Parliament’s education select committee, said Ministers should “hold their heads in shame” after reneging on a pledge to close the funding gap between rural and urban areas.

“The ‘rural penalty’, which sees 50 per cent more per head going to urban councils than to rural councils, cannot be justified,” Mr Stuart said.

Councils in rural areas have long complained they receive less money than their urban counterparts through a complicated funding formula used at Whitehall, which favours urban areas because of their pockets of deprivation.

In December, Communities Secretary Eric Pickles unveiled the latest funding settlement for local councils, triggering yet another round of spending cuts at town halls around the country.

Authorities in rural areas say they have once again been hit disproportionately hard – and with scores of rural libraries now closing along with a downgrading of a wealth of other services, a tipping point may have been reached.

In an angry Commons debate, backbench Tories with rural constituencies queued up to make their displeasure clear.

“We are looking for a fairer settlement,” said Mr Stuart, who is now leading a cross-party group at Westminster to demand a better deal for the countryside.

“We hoped and expected this Government was going to look at doing so on an evidential basis. We are not seeing that.”

Mr Stuart said he had been told by Ministers that a review of council funding last summer would be used to close the gap – but that any change has been “miniscule”.

“The settlement takes a 50 per cent ‘rural penalty’, and reduces it to 49.8 per cent,” he said.

“It is pretty minuscule, and nothing like the closing of the gap we were talking about in the summer – which even then was derisory. Ministers are right... to hold their heads in shame.”

His stance was backed by another of Yorkshire’s most senior backbench Tories, Anne McIntosh, the Thirsk and Malton MP who chairs Parliament’s environment select committee.

“It costs more to deliver public services in rural areas because of the increasing cost of fuel in those areas,” she warned.

Many of the worst-affected councils are Tory-led, and their leaders are becoming increasingly outspoken.

John Weighell, the Conservative leader of North Yorkshire County Council, said recently: “Rural councils have fared worse than urban councils.

“The scope and pace of the savings required mean it is becoming more and more difficult to protect frontline services.”

The same message was echoed from Tory heartlands around the country. Suffolk Tory MP David Ruffley said: “In my 15 years as a Member of Parliament, I do not think I have seen such anger 
on the part of rural council leaders.”

Penrith Tory MP Rory Stewart said rural communities now faced a “serious crisis”. Devon Tory MP Geoffrey Cox said borough councils in his constituency were facing an “existential threat”.

But the Government insists its funding settlement is fair to all parts of the country. Communities and Local Government Minister Brandon Lewis said: “It is clear we have actually managed, though I appreciate not to the degree that some would like, to reduce the gap between rural and urban.”