Lincolnshire County Council is extremely concerned at the additional financial pressure caused by the Government’s announcement of the removal of the £9m Rural Services Grant.
This reduction in funding is in addition to rising costs associated with increased demand in adult social care, children’s services and home-to-school-transport.
And the recent increase in national insurance contributions is expected to raise costs by up to a further £15m, with the rise in the national living wage costing at least an additional £5m.
The council estimates that that even before these new pressures, Lincolnshire is being short-changed by more than £100m a year due to the Government’s funding formula.
Cllr Martin Hill OBE, leader of Lincolnshire County Council, said: “While some additional money has been promised, there is also very significant cause for concern that it will not be enough to cover these huge extra costs.
“We are particularly disappointed to see that the Rural Services Delivery Grant has been scrapped. This was introduced in recognition of the additional challenges rural authorities face in delivering services, and its removal seems like a backward step.
“Instead, the government has said it will focus on ‘deprivation’ in reforming the funding system. There is currently no clarity as to what this means, and we have a real fear that money will be taken from rural communities and given to urban areas – making our unfair deal even worse.
“We need assurances from Government that we will be compensated for these additional costs in this year’s settlement. At present all that appears certain is the Government’s expectation of a five per cent increase in council tax.”