York Hit by £14.1m Government Funding Cut Under New Financial Settlement

York will lose £14.1 million a year in Government funding by the end of the new multi-year financial settlement, Liberal Democrats have warned, after confirmed figures revealed a significant cut to core grants. 

Government grant funding for York will fall from £69.6 million this year to just £55.5 million by 2028/29, despite rising demand for services and inflation continuing to drive up costs. 

While Ministers claim that York’s “core spending power” will rise by 7.7% between 2025 and 2029, this headline figure relies on councils putting up council tax to the maximum level every year. Even with those increases built in, the amount of money York receives directly from Government will be £14.1 million lower each year by the end of the settlement period. 

York is already the least well-funded council in the country, yet this settlement leaves the city expected to manage growing pressures with substantially less Government support. 

Demand for adult social care in York continues to rise as the population ages, with costs driven up further by workforce shortages and national policy decisions. Liberal Democrats warn that removing funding at this scale will inevitably put pressure on frontline services and local taxpayers. 

York Liberal Democrats are calling on the Government to urgently reverse the cut in grant funding, properly fund adult social care, and finally address the long-standing unfairness in how councils like York are funded. 

Councillor Nigel Ayre, York Liberal Democrat Group Leader, said:

“These figures lay bare the reality behind the Government’s spin.

“York’s Government grant funding is being cut from £69.6 million to £55.5 million, a loss of £14.1 million a year by the end of this settlement. That is money being stripped away from our city. With costs rising by around 3% each year, this cancels out the supposed 7.7% rise in ‘core spending power’ over the next three years and results in a real terms cut. 

“Labour can dress this up however they like, but the only way they get to a headline increase is by assuming residents pay the maximum in council tax every single year. 

“Once you strip away the spin, residents are being asked to pay more in council tax for fewer services, while a Labour government takes funding away from York. 

“York is already the least well-funded council in the country. Instead of fixing that injustice, this three-year settlement makes it worse. 

“We will continue to stand up for York, fight for fair funding, and protect the vital services residents rely on.”