South Hams councillors warn of council tax rise after “worst” funding settlement

Councillors in South Hams say their area has been left out by the government’s latest local authority funding package, forcing the district to raise council tax by the maximum permitted amount.

Members of South Hams District Council were told the authority will receive a “fair funding allocation” of £5.5 million for 2026/27, giving it a core spending power of £15.3 million. However, this still leaves a projected budget gap of £2.5 million between expected spending and available income.

As a result, the council will increase its share of local council tax bills by 2.99 per cent.

Cllr Simon Rake (Lib Dem, Blackawton and Stoke Fleming) told a full council meeting: “It would be hard to think of a financial settlement that could have been worse for the South Hams. It feels as if the government is specifically targeting us. We are one of the councils that received the lowest and worst financial settlements in the country.”

He said financial allowances linked to rurality, coastal protection, flood management and tourism had all been removed from the settlement.

Other councillors echoed the concerns. Cllr Lee Bonham (Lib Dem, Loddiswell and Aveton Gifford) described the settlement as “unfair” and an attack on rural councils, while Cllr Nicky Hopwood (Con, Woolwell) said it offered no support for the farming industry.

Council leader Dan Thomas (Lib Dem, Newton and Yealmpton) warned the settlement reflected the direction of planned local government reorganisation, under which district councils such as South Hams could be replaced by larger unitary authorities.

“What this says is that if you’re a shire district, good bye,” he said. “The plan is that we shouldn’t exist by 2028.

“We are doing everything we can, and lobbying is constantly happening. You can knock on a door as many times as you like, but if the person on the other side isn’t listening or doesn’t want to open it, it really doesn’t matter how many times you knock.”

Cllr Julian Brazil (Lib Dem, Stokenham), who also leads Devon County Council, said the government was increasingly shifting the cost of essential services from central funding to local taxpayers.

“Those who are the most vulnerable and struggle the most in the cost-of-living crisis will be the most penalised,” he said. “But we don’t have any choice. The government expects vital services to be delivered by local taxation, and it’s a sorry state of affairs.”

Despite the financial pressures, councillors paid tribute to council officers for producing a balanced budget, highlighting what Thomas described as “reasons to be cheerful” within the authority’s financial plans.