· 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
today 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
2020/2021, 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.
Local
Government Secretary Rt Hon
Robert Jenrick MP
said:
“This
Government is committed to levelling up every part of the
country, investing in every region and giving communities control
over making the decisions which are right for
them.
“That’s why
we’re confirming the biggest increase in
councils’ spending power for a decade across
England, while protecting
residents from excessive rises in council
tax.”
Provisional plans
for the Local Government Finance Settlement for 2020/21 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.
Ends
Notes to
Editors:
What the
settlement includes:
More
funding for social care
The settlement
makes £1.5 billion of new funding available for adult and
children’s social care, supporting local
authorities to meet rising demand, fund more care home places and
social workers and protect the most vulnerable in
society.
The package
includes £1 billion of new grant funding, a continuation of all
existing social care grants, and the ability for
authorities to raise up to £500 million more for adult
social care, where needed.
In total, local
authorities will have access to almost £6 billion of dedicated
funding across adults and children’s social care in
2020/21.
Preventing
excessive council tax
rises
The Government is
committed to keeping bills low and giving local residents the
final say over council tax
increases.
Under the
referendum principles, average council tax increases for 2020/21
are expected to be the lowest since 2016-17. A referendum will be
required if local authorities propose raising the tax above a
core threshold of 2%, with extra flexibility for some authority
types including shire district councils, Mayoral Combined
Authorities and town and parish
councils.
Protection
for core funding
Core funding will
be protected in 2020-2021, 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 2020-21. 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.
Additional
information
· This
relates to England only.
· On
4 September 2019, the Government set out the results of the 2019
Spending Round, providing access to a rise in local authority
spending power from £46.2 billion to £49.2 billion in 2020-21, an
increase of £2.9 billion or an estimated 4.4% real-terms
increase.
· On
20 December 2019, the Government published the
provisional Local Government Finance Settlement through
a Written Ministerial
Statement.
· The
additional £1.5 billion for adult and children’s social care is
broken down as: £1 billion of funding for child and adult social
care and a further £500 million available through the
adult social care precept. The £1 billion grant includes £150
million to equalise the impact of the
precept.
