Question to the Ministry of Housing, Communities and Local Government:

To ask the Secretary of State for Housing, Communities and Local Government, what assessment was made in the process of developing the Fair Funding Allocation formulae of the adequacy of the evidence supplied by stakeholders and local authorities of the cost impacts of remoteness and rurality.

The government published the Local government finance policy statement 2026-27 to 2028-29 and response to the Fair Funding Review 2.0 on Thursday 20 November, which set out the government's plans to introduce a fairer and evidence-led funding system. The government also published the Provisional Local Government Finance Settlement 2026-2027 to 2028-2029 on Wednesday 17 December 2025. The government is committed to continuing to work closely with the sector. We have now consulted four times on our proposals for reform and we are grateful for the high-quality and constructive responses received from local authorities and sector groups.

The government is committed to tackling the issues that matter to rural communities. Our updates will account for local circumstances, including the variation in cost of delivering services, such as between rural and urban areas. More detail can be found in the consultation response document here.

As part of this, the government is including a remoteness adjustment within the adult social care formula, as the best evidence we have heard indicates that distance from a major market has an impact on the cost of delivering social care services. We are also including a journey times adjustment, which is within the area cost adjustment applied to all our funding formulas, which accounts for the impact on the cost of labour of the difference in travel times to provide services; and increasing the cap within the home to school transport formula from 20 miles to 50 miles, in recognition that the original distance cap would unfairly penalise authorities who have no choice but to place children further from home.

The government is considering the responses received following the consultation of the Provisional Local Government Finance Settlement 2026 to 2027 and will set out a position when the final Settlement is published in early February.