Embargoed until 0001hrs Friday 2 April 2010
Publication of report:
The implications of national funding formulae
for rural health and education provision
All-Party Parliamentary Group on Rural Services
The formulae for both health and education funding provides less money per pupil and patient for those who live in rural areas, despite the cost of achieving equitable service outcomes being higher than in urban areas.
In a report launched today, the All-Party Parliamentary Group on Rural Services concludes that successive governments have failed to address a system which weights funding according to projected needs rather than actual cost. This leaves many rural authorities under-funded.
Commenting on the report, Chairman of the Group, Philip Dunne MP said:
“The allocation of funding for education and health services is a black box which few understand. It is clear that what is needed is a review of the funding formulae. Managing changes to the basis of the formulae will not happen quickly, as redistribution of resources is more realistically undertaken during periods of economic growth. But the next Government must work to ensure that rural needs are fairly reflected in the allocation of funding.”
The report highlights an unacceptable lack of transparency in decisions surrounding the current formula, with percentage increases applied to previous funding levels only serving to prolong pre-existing imbalances. In light of this, the report includes 17 recommendations on improving the fairness and transparency of the formulae, including:
- The funding formulae for England should include rurality adjustments, as they do elsewhere in the UK.
- Age-related needs should be given greater weight in the health funding formula, taking account of the older demography of rural areas.
- Funding targeted at ‘health inequalities’ should be separated from funding for access and need.
- Both formulae should include a transport element, to reflect the higher costs of provision in remote and rural areas.
- Sparsity adjustments should made applicable to secondary schools, just as they are to primary schools.
- Government should evaluate the impact of deprivation measures in rural and urban areas and seek to improve their accuracy and sensitivity to rural deprivation.
Dan Rogerson MP, who chaired one of the inquiry panels, emphasised the funding inequalities highlighted in the report:
“This cross-party report draws on a range of evidence to conclude that there is a clear need for a complete change in the way rural services are funded. Children in my constituency get over £300 a year per head less than the national average, yet it's clear that rural education costs just as much, if not more, to deliver.
“Meanwhile, areas like Cornwall are left behind when it comes to health funding too, despite the clear challenges in providing equal access for equal need in rural Britain. In particular, the Market Forces Factor, which ties health funding to low local wages, has a pernicious and perverse effect.”
David Drew MP also echoed the comments of other APPG members, adding:
“I was delighted to be able to take part in these hearings and welcome the definitive advice and recommendations that the report makes highlighting the need for a new approach for funding streams in rural areas.”
ENDS.
Notes:
1. The All-Party Parliamentary Group on Rural Services is a cross-party group of MPs and Peers which aims to promote debate on the provision of rural services.
2. The inquiry panels consisted of 11 members of the group; Philip Dunne MP (Chair), Graham Stuart MP, Dan Rogerson MP, Rt Hon Sir Alan Beith MP, David Drew MP, Roger Williams MP, Lord Cameron of Dillington, Baroness Gibson of Market Rasen OBE, Baroness Byford, Lord Dear QPM, and The Duke of Montrose.
3. Full details of the evidence taken by the inquiry can be found in the full report, including transcripts of oral evidence sessions. A full copy of the report can be downloaded at: http://www.rsnonline.org.uk/images/files/appgfunding-full-260310.pdf. A summary of the report can be downloaded at: http://www.rsnonline.org.uk/images/files/appgfunding-summary-260310.pdf
Media enquiries:
Graham Biggs
Rural Services Network
07966 790197
Other enquiries:
Hard copies of the report may be obtained from the Commission for Rural Communities, who provide the secretariat of the Group on behalf of the Sparsity Partnership for Authorities Delivering Rural Services (SPARSE). Contact: 0300 068 6445.