Rother District councillors have criticised the government’s Fair Funding Review 2.0 as they unanimously approved the authority’s 2026/27 budget.
At a meeting of the full council on Monday 23 February, members agreed a 2.99% rise in the council’s share of council tax, taking the baseline charge for a Band D property to £216.95, before Rye Town Council, East Sussex County Council, police and fire precepts are added.
Unlike recent years, the budget does not rely on using general reserves to close a funding gap. Council leader Doug Oliver said balancing the books had been “very, very challenging” and was achieved through tight budget control by officers, the director of resources and the chief executive.
“I have always felt reserves are there for a rainy day,” he said. “Compared to many other local authorities who have had to get exceptional financial assistance, we are where we are.”
A report to councillors said the authority expects to add around £433,000 to general reserves at the end of 2025/26, thanks to delivering more than 87% of savings targets in-year, additional investment interest and a higher final government grant than originally forecast.
However, members raised concerns about the longer-term impact of the Fair Funding Review 2.0, which introduces new funding formulas, streamlines grants and resets business rates retention in an effort to redistribute resources more evenly.
For Rother, the changes mean its Revenue Support Grant will be around £487,000 less than expected in 2026/27. This will be offset by a one-year adjustment support grant of the same amount, but councillors warned of a looming funding cliff-edge. The council has also secured an additional £67,000 for homelessness, rough sleeping and domestic abuse services.
Conservative councillor John Barnes, vice chairman of the audit and standards committee, said reserves had been “run down at a remarkable rate” and could fall to about £1.5 million in the medium term.
“It is unsurprising that we are facing a medium-term financial crisis,” he said, arguing that future settlements are unlikely to keep pace with inflation. He added that any major crisis could easily destabilise the council’s finances.
Deputy leader Susan Prochak described the local government funding system as “broken” and said rural deprivation had not been properly recognised. Citing analysis from the Rural Services Network, she said rural residents were being asked to contribute more through council tax to compensate for structural funding shortfalls.
Changes agreed to the budget also include reinstating a £1,070 grant to Sussex Wildlife Trust and freezing winter parking charges in Camber. Councillors also maintained the authority’s 100% council tax reduction scheme for low-income households.
Image Credits: RDC .