Rural residents in England receive 50% less in government grants than their urban counterparts, yet pay £100 more per year in council tax, according to a study by the Rural Service Network (RSN). The research found that predominantly rural authorities were given an average of £324 per head in government grants, compared to £487 for urban authorities.
The RSN is urging the government to address this imbalance through the Local Government Resource Review. Council tax per head was nearly 21% higher in rural areas (£572) versus urban areas (£473), but total revenue spending power remained lower for rural authorities. RSN chairman Roger Begy described this as a 'rural penalty', forcing countryside residents to pay more for fewer public services despite lower earnings.
The Department for Communities defended the current system, stating that councils are gaining more control over spending and that tax levels are 'fair'. A spokesman highlighted a £650m fund to freeze council tax bills for one year, offering help to families including those in rural areas. The government is also considering allowing councils to retain business rates, though poorer areas fear this could worsen disparities.
Conservative MP Graham Stuart, chair of the All-Party Parliamentary Group on Rural Services, called the funding disparity 'extremely disappointing' and urged the government to reform what he termed an 'unbalanced funding formula'. The RSN study was conducted by independent consultancy Local Government Futures.
