Leading Conservative councillors in Northumberland have warned that council tax increases remain on the horizon despite the Labour Government’s plan to reform council funding.

Under new plans set to be consulted on next month, Labour say councils will see an overall increase of 3.2 per cent in real-terms funding for 2025/26. The Government say the “long overdue” reforms will “offer better value for money” and allow councils to “fix the foundations of local government”.

In addition, councils with a significant rural population will receive an increase of around 5 per cent in their Core Spending Power, and will be better off this year compared with 2024-2025.  The Government say the new system will be “fairer” and match “funding with need”.

But the council’s deputy leader, Coun Richard Wearmouth, warned that despite the increases, council tax rises would be unavoidable in the near future.

He said: “Whilst the government has publicly discussed funding for councils in broad terms we have had no confirmation on what if any extra funding the county council might or might not receive.

"This will not become clear until just before Christmas – so until then this is all fluffy headlines with no substance.

“I must note that if NCC received 3 per cent additional real terms funding this still would not likely cover the huge cost increases we have seen for adult social care and in particular special educational needs provision which are exponentially increasing at present.

"All this of course is far from what Prime Minister Keir Starmer pledged when he said in 2023 that Labour would freeze council tax.

“That promise has not been kept, as there is no chance with this settlement that the council can avoid council tax increases – despite a whole host of efficiency measures that are being put in place.”

According to the Institute for Fiscal Studies, under the previous Conservative Government, councils’ overall funding fell 9 per cent in real terms and were 18 per cent lower in real terms per person. Last year, Northumberland Labour pointed out that the Conservative Government had cut funding to the area by £130.18 million in real terms since 2010.

Introducing the proposals, Deputy Prime Minister Angela Rayner said: “For too long councils have been let down by an outdated and inefficient funding system which has led to public services creaking and taxpayers’ money not being spent efficiently.

“Whilst there’s no magic wand to fix what we’ve inherited, we’re taking the necessary steps to fix the foundations of local government by creating a fairer system and ensuring every penny is spent on the services so many people rely on every day.”

Northumberland County Council leader Glen Sanderson was concerned about plans to ‘repurpose’ the rural services delivery grant, which is worth around £3.18 million to the county council.

Coun Sanderson said: “The devil is in the detail – but it looks as like we would lose the rural services grant, which is very worrying for councils like ours.

“There seems to be no indication of understanding the huge extra costs we are having to find each year for looked after children and adults’ social care. These have cost us an additional £50 million over the past five years.”