Councils in rural areas should receive a local growth deal before the next spending round, the District Councils' Network has urged - after MPs reported councils in countryside areas are getting an unfair financial deal from government.

The Environment and Rural Affairs Committee study into the work of Defra and its Rural Communities Policy Unit urges the department to work with DCLG officials to take account of the extra costs providing services to countryside areas.

‘The Government needs to recognise that the current system of calculating the local government finance settlement is deeply unfair to rural areas in comparison with their urban counterparts,' said chair of the Committee, Anne McIntosh MP.

‘Rural communities pay more in council tax, receive less government grant and have access to fewer public services than people in large towns and cities,' Ms McIntosh added.

Cllr Neil Clarke, chairman of the District Councils' Network (DCN) told The MJ: ‘We strongly support their recommendation for a fairer funding settlement for rural areas that acknowledges the service delivery pressures faced by district councils in sparsely populated areas.

‘In addition, we believe that it is important the Rural Communities Policy Unit monitor the impact of the New Homes Bonus on rural communities, particularly in light of recent announcements to pool a significant proportion of this funding with LEPs.'

According to Cllr Clarke, the government should encourage greater district representation at LEP boards among measures to support rural economies.

‘As the Committee points out, it's important that Government initiatives, such as City Deals, don't leave rural areas and their economies behind. Alongside an extension of the Rural Growth Networks, the DCN would like Local Growth Deals for non-urban areas bought forward before 2015,' Cllr Clarke added.

He added that districts are already working collaboratively and proactively with local firms on planning issues and business rate advice to promote sustainable economic growth.

Whilst agreeing with the Committee that districts need to work proactively with businesses on planning issues and business rate advice, we would stress that our members are already working collaboratively with the sector on planning reform and the collection of business rates to promote sustainable economic growth.

In response, a DCLG spokeswoman said: 'Council's funding settlement is fair to all parts of the country - rural or urban, district or county, city or shire.