Smith Square has urged Whitehall to consider itself first when seeking the next wave of public spending cuts, after the coalition confirmed that single-tier, county councils and shire districts have had their grants slashed by almost 20% over two years.

Local government minister, Bob Neill, confirmed the second year of the two-year finance settlement on 8 December, and revealed a total of £27.8bn would be distributed. As expected, formula grant to all authorities is set to fall by a further 7.7% on top of a previous 9.9% reduction.