Council Welcomes Government  Change of heart on Funding

Hampshire County Council Leader, Councillor Roy Perry has welcomed this week’s announcement by the Government of £150 million of additional support for councils in each of the next two years.

The announcement by Communities Secretary, Greg Clark came after many councils, and MPs in county areas expressed their serious concerns over changes to funding calculations that had particularly hit rural and semi-rural counties.

As a result of the changed funding formula, Hampshire was told just before Christmas that it would face an unprecedented reduction of £48 million in its grant for the 2016/17 financial year. In response, Councillor Perry wrote to the Prime Minister, Chancellor of the Exchequer and Local Government Minister Greg Clark, expressing his deep concern at the scale of the reduction just weeks before the need to set a balanced budget. Hampshire MPs in the All Party Parliamentary Group for Hampshire, led by new MP for North East Hampshire, Ranil Jayawardena, in common with many MPs from county areas, had also taken a delegation to meet Greg Clark, Secretary of State.

Commenting, Councillor Perry said: “I am very pleased the Government has listened to us and allocated additional funding. It is welcome as far as it goes. Hampshire County Council is now in line to receive an additional £9 million in each of the next two years, and we will be the second largest beneficiary in the country, after Surrey. However, it is only transitional help for two years and the fact remains that we still have to find significant recurring efficiency savings in the years ahead. The funding shortfalls caused by changes to the way Government grant is allocated lost Hampshire County Council £48 million from its 2016/17 grant.

“The Government also made its calculations on the assumption we would raise Council Tax, particularly to pay for increased adult social care pressures – and thereby ease pressures on the NHS. As a consequence, Hampshire County Council is now facing the very real prospect of having to raise council tax for the first time in six years. Even with the extra grant now allocated because of the earlier reduction, and increased pressures especially in adult social care, we still face a funding gap of over £81 million for the coming financial year.

“Under the initial allocation announced just before Christmas, the Revenue Support Grant for Hampshire was just £139.80 per dwelling – a reduction of 37% on the previous year, whereas Metropolitan areas such as Barnsley were allocated £288.70 per dwelling, and Manchester £441.23.

“County areas, for a long while, have been receiving significantly less than metropolitan city areas.

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