‘Cash injection claims risk misleading residents about council finances’

Cllr Cheatley said: “Recent coverage suggesting that North Northamptonshire Council has received a “£79.3m cash injection” from Government risks misleading residents about the council’s finances.

“This figure does not represent a lump sum payment or “windfall”.

“It is a projection of Core Spending Power – a technical measure that includes income from local council tax rises, alongside Government grant.

“In reality, most of the headline figure is not new money from Whitehall at all.

“The council’s draft budget already assumed £431.274m in funding. Following the provisional settlement, funding improves by just £6.279m across 2026–29, with a further £4.341m improvement expected in 2029–30.

“These changes are spread over several financial years and are far short of the reported £79m “boost”.

“Separately, the Dedicated Schools Grant increases by around £17.7m, but this is ring-fenced and cannot support general council services such as highways, waste, libraries, or adult social care.

“The crucial context is that these figures assume the maximum possible council tax rise. The projections used by Government in calculating “Core Spending Power” are based on the assumption that councils grow their tax base each year, and increase council tax to the maximum allowed every year under referendum limits.

“In other words, the “£79m” is not Government generosity – it is calculated on the basis that residents pay more council tax.

“For North Northamptonshire, this means that roughly £57m of the headline total would come from local taxpayers if council tax increases are applied at the maximum annually.

“If a council chooses not to raise council tax to the assumed level – or raises less – its actual cash resources will be lower than the projections, creating a funding gap against expectations.

“Calling this a “cash injection” therefore overstates what central Government is actually providing.

“Recent last-minute changes to the national funding formulas – including adjustments linked to location and urban weighting – appear to have benefited London and metropolitan authorities more than county and rural areas, such as NNC.

“This creates understandable concern that some areas are gaining disproportionately, while others face continuing pressure to reduce services despite rising demand.

“It remains vital that the awaited final settlement fairly reflects local need, recognises demand growth in areas like social care and children’s services, and provides enough stability to avoid severe cuts.

“The reality for North Northamptonshire is that even after the settlement, the council’s medium-term gap only reduces from £35.845m to £27.523m.

“Demand for key services has risen by almost 30 per cent since 2024/25 and inflation and care-market pressures continue to outstrip available funding.

“This is not a financial windfall.

“It is a challenging position that still requires careful financial management and difficult choices.

“Residents deserve clear reporting that distinguishes between technical funding projections, increases driven by council tax, and genuine new Government investment.

“Terms like “cash injection” or “windfall” risk creating the false impression that councils have been handed large amounts of new spending money when, in reality, much of it relies on local taxpayers.”