Recently the Labour and Co-Operative Group have been claiming that under the Conservative Government, Medway Council's funding has been reduced by 91%. This simply isn’t true and this article will lay out how Government funding to local councils has changed since 2010.
The opposition put forward an amendment to the Labour and Co-Operative Group’s Motion at full council on the 19th October which pointed out that Medway’s core spending power had actually increased from £183 million in 2010-2011 to £243 million in 2023-2024. It came as no surprise to the opposition that the amendment was voted down, but it was a good opportunity to dispel the myth of a 91% funding cut to the council.
In 2010-11 Medway Council received a Formula Grant of £85.13 million which consisted of the Government Revenue Grant and a proportion of business rates from the council, the Conservative Government then changed the way in which local authorities like Medway Council would be funded, 50% of business rates would be retained by the council instead of being paid back to the authority in the form of a formula grant. This is what the Labour and Co-Operative group are- at best- misunderstanding.
In the years since 2010-2011 Medway Council has a variety of income streams which contribute to the council’s budget such as The Settlement Funding Assessment, the Improved Better Care Fund, The Social Care Grant, The Services Grant and Section 31 (Compensation for under-indexing the Business Rates Multiplier). As a result of these changes the Council's overall core spending power is £243 million as of 2023-2024, an increase from £222 million in 2022/2023 and an increase from £85.13 million in 2010-2011.
The motion did acknowledge the challenges to Medway Council's funding, particularly pressures on social care, inflation, as well as location specific matters, including challenges due to Medway's location and authority type which attracts lower grant funding from Government.
The opposition are disappointed to see Labour still claim there has been a 91% reduction to council funding, it is misleading and simply not true. The group were also disappointed to see this misrepresentation of a 91% cut to council funding appear on council press releases. We will continue to call this out.
All information in this article is sourced from Medway.gov.uk