County Councils Warn Rural Taxpayers Face Funding Burden

Proposed government reforms to local government finance, known as the Fair Funding Review 2.0, are set to disproportionately burden rural and county council taxpayers, who will face maximum council tax rises to fund local services and redistribute funding to urban areas. Analysis by the County Councils Network (CCN) reveals that while some rural councils will see government grant increases totaling £845 million, the majority of their funding growth—about 70% on average—will come from council tax hikes, with some councils needing to raise nearly all additional funds through local taxation. The reforms include using 100% of local council tax receipts in funding allocations, up from 85%, leading to an estimated £1.6 billion of council tax income being redistributed from county areas to urban centers, with 32 out of 38 rural authorities losing an additional £400 million. Town hall leaders warn this will force cuts to vital services and increase financial pressure on rural residents, who have already faced significant tax rises. Critics, including Tory leader Kemi Badenoch, argue these changes unfairly shift resources to Labour-controlled urban areas, exacerbating rural funding challenges and risking the provision of essential services. The CCN calls for urgent additional government funding to mitigate the impact and ensure rural councils can maintain care for vulnerable populations.