More than 40 Conservative MPs call on Government to increase local government funding

A group of 44 Conservative MPs, which includes seven former cabinet members, have urged the Government to provide an emergency injection of funding for councils to prevent major reductions to local services.

In a letter to Prime Minister Rishi Sunak and the Secretary of State for Levelling Up Michael Gove, the group said the current local government funding plans fail to tackle the financial needs of county and unitary councils.

The group of MPs include former Local Government Secretary of States Robert Jenrick and Greg Clark, as well as prominent former cabinet members such as Priti Patel, Therese Coffey, Damien Green, and Brandon Lewis. They also include former local government ministers Neil O'Brien, Heather Wheeler, Kit Malthouse, and Jake Berry.

One Labour MP and one Liberal Democrat MP also signed the letter.

The letter, which was coordinated by the County All-Party Parliamentary Group (APPG), argued that funding announcements in the Autumn Statement and Provisional Local Government Settlement do not cover the costs of higher inflation, escalating demand for services and the recent increase in national Living Wage.

The letter pointed to figures from the County Councils Network, which showed councils are predicting a £650m overspend this year and face a £4bn funding deficit over three years.

"Whilst there were many brilliant announcements in the Autumn Statement, we were disappointed that it did not provide any additional support to local government, despite the strong rumours that had circulated in advance," the letter reads.

"Furthermore, the national Living Wage increase that was announced, whilst welcome to the individuals and families that we represent, will add hundreds of millions of additional, unplanned, costs to councils' budgets."

It continued: "The past twelve months have been tough financially for many of the communities that we represent given the unprecedent level of inflation and demand for services.

"We are therefore exceptionally concerned that without any additional investment, the overwhelming majority of upper tier councils in our areas are planning service reductions and higher council tax in order that they can pass a balanced budget for the next financial year, as they are legally required to do."

The letter said there is still an opportunity to "rectify" the situation and ensure MPs are able to support the vote on the final Local Government Settlement in the House of Commons in February.

It urged the Government to use the Final Local Government Finance Settlement to provide additional funding for local Government.

The letter called for any additional funding to be directed towards children's services and home to school transport "as combined these are exerting unprecedented pressure on local government services".

The Local Government Association (LGA) also raised concerns about funding following the Government’s Autumn Statement and its Provisional Local Government Settlement.

The provisional settlement represents an increase of 6.5% but this presumed that local authorities in England would increase council tax by the total amount allowed without triggering the requirement to hold a referendum.

In response, the LGA said: “The settlement does not provide enough funding to meet the severe cost and demand pressures which have left councils of all political colours and types warning of the serious challenges they face to set balanced budgets next year.”

A Department for Levelling Up, Housing and Communities spokesperson said: “We recognise councils are facing challenges and that is why we have announced a £64 billion funding package – an above inflation increase at an average of 6.5% - to ensure they can continue making a difference, alongside our combined efforts to level up.

“We recently consulted on the final settlement for next year and are now considering the responses carefully.

“Councils are ultimately responsible for their own finances, but we remain ready to talk to any concerned about its financial position.”

The Cabinet Office has been approached for comment.

Adam Carey