A group of influential town councils has urged their national body, the National Association of Local Councils (NALC), to campaign for fairer funding to ensure tens of millions of pounds of government funding is passed on to them.
NALC's larger local councils committee, which represents the interests of larger parish and town councils within the organisation, expressed its anger at their recent meeting that a quarter of council tax support funding from the government was being withheld by principal (county, district, borough or unitary) councils.
Previous government ministers had written to councils asking for the money to be passed on, instructions ignored by around 30 authorities and described "as useful a chocolate fireguard" by the committee. Town council leaders have also warned that they expect the situation to get worse as long as principal authorities continue to "get away with it".
However, the committee welcomed the decision by the previous government not to extend referenda principles to parish councils, praising NALC's campaigning on this issue, but urged continued action to ensure parish budgets are determined locally and without interference by ministers.
NALC welcomes the findings of this committee and will be campaigning on this with the new Conservative government.
Cllr Ken Cleary, chair of NALC's larger local councils committee, said: "It is bitterly disappointing that principal councils have ignored instructions to pass on around £40 million of government funding to parish councils. Letters from previous ministers to councils have been as useful as a chocolate fireguard, so a different approach is now needed.
"Communities have been short-changed by around £10m and this is likely to get worse if principal councils are allowed to get away with it. We need fairer funding for our parishes to ensure they can continue to improve lives and enhance communities."