Government in England has confirmed a multi-billion pound spending increase for councils.
image: Open Government Licence v3.0
- Local Government Secretary Robert Jenrick confirms £49.2 billion package of funding for local councils
- Settlement is the biggest real-terms increase in spending power in a decade and includes an extra £1.5 billion for social care
- Most residents are expected to see the lowest increase in council tax bills since 2016
The biggest increase in councils’ spending power for a decade was confirmed yesterday (24 February 2020) by the Local Government Secretary, Rt Hon Robert Jenrick MP.
Following a vote in the House of Commons, the government confirmed councils in England will have access to a share of £49.2 billion in 2020 to 2021, an increase of £2.9 billion or 4.4% in real-terms.
The settlement will give councils access to a £1.5 billion boost for social care funding and ensures, on average, residents can expect to see the lowest increase in council tax bills since 2016.
The final settlement also incentivises local economic growth, with £40 million to be redistributed to councils following increased growth in business rates income.
… Provisional plans for the local government finance settlement for 2020 to 2021 were published in December, followed by a period of consultation with the sector.
This included the consideration of over 200 representations across technical and provisional consultations from a range of organisations, and ministers met with representative groups including local councils, MPs and the Local Government Association…..
What the settlement includes….
Protection for core funding
Core funding will be protected in 2020 to 2021, conserving the vital, core services which residents rely on. The final settlement confirms settlement core funding will be increased in line with inflation, and any Negative Revenue Support Grant is directly eliminated.
Business rates levy surplus
Local authorities play a key role in supporting economic growth. As a result of increased growth in business rates income, the government will redistribute £40 million of the levy surplus to all local authorities on the basis of assessed need.
Rewards for building new homes
The government has committed £907 million to continue the New Homes Bonus scheme in 2020 to 2021. The scheme financially rewards local authorities for the number of new homes they build locally, incentivising housing growth and creating homes for local residents.
Support for rural areas
The government is committed to ensuring the unique needs of rural areas are met, and so will maintain last year’s Rural Services Delivery Grant at £81 million, matching the highest rural grant paid to date.