Osborne’s devolution experiment will hit poorer councils where it hurts
Before reading this article I was reflecting on how a 56% cut in grants would affect rural authorities compared to urban ones. We have had to raise more of our finance democratically through rates for years. Im not sure I am fully persuaded that all the bad news in this new regime will be for those now having to get used to the same principle as this article suggests – for example these sort of authorities do not face the rural premium – the article itself tells us:
Alongside this heavily constrained handover of authority comes a great claw-back of central funds and a showering of new responsibilities. Some cutting of central grants is a logical corollary of decentralisation, but since 2010 the cuts have shown scant regard for the health of the local tax base. The Institute for Fiscal Studies calculates that purchasing power of the councils that depend more on grants is down by nearly 40%, around double the decline in the least grant-dependent boroughs.