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Counties pile the pressure on weak government as history repeats itself

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LGC’s essential daily briefing.

It had been quiet, perhaps a little too quiet.

But almost as sure as night follows day, a major row has erupted over the local government finance settlement.

Almost two years ago to the day, a group of Conservative backbenchers expressed their unhappiness about the 2016-17 financial settlement offer to the shire areas leading to concerns the government could lose a vote in the Commons.

In response the then communities secretary Greg Clark buckled and announced that the councils which had lost most in the provisional local government finance settlement would receive a share of £300m transitional relief spread over two years.

Crisis was averted… for a short time anyway.

The fact it turned out most of the funding, distributed between 140 local authorities, went to Conservative county councils raised eyebrows. The fact just three metropolitan councils – Trafford, Solihull and Stockport MBCs – received any transitional funding, the former two being the only Conservative-controlled mets, raised eyebrows even further.

So much so that Nottingham City Council’s deputy leader Graham Chapman (Lab) has been in a long-running Freedom of Information battle with the now Ministry for Housing, Communities & Local Government as he continues to seek details of how distribution of the grant, worth £150m in 2016-17 and 2017-18, was determined.

Last winter the social care crisis rose to the top of the national news agenda, in part due to the sector’s lobbying and concerns raised in Parliament.

That led to the social care precept being introduced (for top-tier councils only, although the District Councils’ Network has made a bold bid for something similar this time around) while about £240m was shifted from the new homes bonus to social care in a move that truly did rob Peter (Fleming, Sevenoaks DC leader) to pay Paul (Carter, Kent CC leader). It also turned out that a third of top-tier councils lost out under the redistribution of the funds.

However, it was somewhat of a surprise to many that this year’s finance settlement did not contain an extension of the transition grant. At the time, Cllr Carter, also chair of the County Councils Network, expressed his disappointment adding the loss of the grant “exacerbates the precarious position of rural county services”.

Fast forward a few weeks and it would appear history really does have a habit of repeating itself. A group of Tory backbenchers, led by Shrewsbury and Atcham MP Daniel Kawczynski (Con), are threatening to rebel against the government in next week’s debate on the final settlement (expected on Wednesday) in the hope of getting more money for their areas.

Hastily arranged meetings with housing and communities secretary Sajid Javid and chancellor Philip Hammond have been held.

The matter has become so severe it even got a mention in prime minister’s questions yesterday. De facto deputy PM David Lidington, who was standing in for Ms May, urged Mr Kawczynski to “continue talking to the communities secretary and other ministers” on the matter.

However, Mr Kawczynski tweeted today that he “cannot support proposed settlement until government finds more money to help” his local authority Shropshire Council plug a £10m gap in its adult social care budget.

This crisis has not yet been averted.

LGC understands there is unlikely to be a repeat of this year’s new homes bonus debacle, but as Theresa May can ill afford (yet another) public humiliation who would bet against more money (and new money at that) being found for the increasingly powerful rural shires?

After all, it is the shires who have the greatest political ability to put the pressure on MPs and ministers.

If the magic money tree is to bear fruit, the sector will hope there is at least full transparency around the way the cash is distributed this time around.

By David Paine, acting news editor

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