North Somerset Council Leader brands new authority funding a "sham"
The government has reformed how it allocates funding to councils
The leader of North Somerset Council has branded the government’s fair funding review a “sham” which has raided local finances, in a furious statement.
The government has reformed how it allocates funding to councils, following its “fair funding review.”
Allocations will now be based on the latest deprivation data which the government says will ensure communities with the highest need will get the services they need — but North Somerset Council has warned that it is forecast to lose more than £17m of government funding under the changes, a cut of almost 20%.
Council leader Mike Bell (Weston-super-Mare Central, Liberal Democrat) said: “The so-called fair funding review is a sham. It papers over years of neglect, it refuses to fix the warped council tax system, and it withholds the basic funding we need to run essential services. It ties councils’ hands, then blames us for the consequences.
“Instead of repairing a broken framework, ministers have chosen to worsen it. Communities like North Somerset, with lower council tax bases, are hit hardest because we cannot raise enough locally to meet soaring demand. We were promised a fair deal, yet what we have been handed is a raid on our budget that will force brutal decisions on local services. This is not levelling-up, it is austerity repackaged.”
Mr Bell previously branded the fair funding review reforms “austerity in disguise” in September. A council report said the review was based on an assumption that councils charge £2,000 in council tax, but North Somerset has an average council tax of £1,794 which would leave it “significantly worse off.”
The amount to which councils can increase council tax is capped at a specific percentage — most recently 5% — by the government. This means that a maximum increase in an area with lower council tax will generate less new income than in areas that already charge more.
North Somerset Council is currently speaking to the government about “exceptional financial support,” which could mean permission to increase council tax by more than the cap. Last year, the government gave neighbouring Somerset Council permission to increase its council tax by 7.5%.
Mr Bell added: “We will continue to fight for North Somerset, and we are calling on the government to rethink these reckless proposals before they inflict lasting damage on our communities. As it stands, this approach shifts the cost of national policy failures onto councils and drives council tax bills even higher.”
In a ministerial statement, minister for local government Alison McGovern said: “This government is taking the tough decisions to create a fairer, evidence-based funding system. This means that poorer local authorities that have been unable to generate as much funding through local tax will finally receive the funding they deserve. As a result, areas will be able to rebuild the public services our communities rely on.”
Reacting to the announcement, Pete Marland of the Local Government Association, the body representing councils, said: “There are some positive measures included in these reforms such as multi-year settlements, fewer fragmented ring-fenced grants and reduced reliance on competitive bidding.
“However, some councils will clearly do better than others from these allocation plans. It is good that government has pledged some extra transitional support but we reiterate our call for all councils, both rural and urban alike, to be protected from real terms cuts to ensure their financial sustainability.
“It is now critical that the provisional Local Government Finance Settlement is published as a matter of urgency so councils are not waiting until the Christmas period to understand what allocations they will receive. Greater financial certainty and a simpler funding system are important, but council finances remain under severe pressure. Councils are facing huge cost increases in areas including adult social care, temporary accommodation, SEND, and home to school transport and so need a significant boost in resources to prevent widespread financial failure.”
North Somerset Council has a £25m black hole in its budget for the next financial year, largely driven by the increasing cost of and demand for social care. Mr Bell previously told the Local Democracy Reporting Service that some individual children had support packages costing the council hundreds of thousands of pounds. He said the costs had quadrupled in recent years while the council’s ability to raise money had not.
Last year, the council took £9.1m out of its reserves to balance its budget for 2025/26 but it still had to make major cuts which one councillor said would “strip our services to the bone.” Three local libraries are “highly likely” to be closed under the cuts, which also saw the council magazine axed and councillors’ allowances frozen.