- Through this local government settlement, we are supporting councils to continue to deliver both high-quality services for their local residents and their frontline role in the covid-19 response.
- Local government core spending power is estimated to increase by 4.5% in cash terms in 2021/22, which follows the largest real terms increase in core spending power for a decade at Spending Review 2019.
- Announcing a new £4 billion Levelling Up Fund, which any local area will be able to apply to directly. This builds on the success of our £3.6 billion Towns Fund, and will fund the things people want and places need.
- Funding vital infrastructure, with total capital spending (CDEL) at £100 billion – once in a generation plans for a once in a generation moment. These plans deliver the highest sustained levels of public sector net investment since the 1970s. Funding the biggest hospital building programme in living memory, and £2.2 billion investment in our schools funding our commitment to rebuild 500 schools over the next decade.
- £1.7 billion in 2021-22 for local roads maintenance and upgrades to tackle potholes, relieve congestion and boost connectivity. Delivering the improvements our communities need.
- £165 million for local authorities through the Troubled Families programme, providing intensive support to families facing multiple interconnected problems.
- In addition, local authorities in England are expected to receive over £3 billion of additional support for Covid-19 pressures next year on top of the over £7 billion the government has provided since March. This takes the total support provided to local authority in England to tackle the impacts of Covid-19 to over £10 billion – this is in line with what the Local Government Association called for. The £3 billion of additional support is:
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- An additional £1.55 billion of funding to meet additional expenditure pressures as a result of Covid-19;
- £670 million of funding to help local authorities support the more than 4 million households with their council tax payments;
- An estimated £762 million to compensate local authorities for 75% of irrecoverable loss of council tax and business rates revenues in 2020-21 that would otherwise need to be funded by local authorities in 2021-22 and later years; and
- Extending the existing Covid-19 sales, fees and charges reimbursement scheme for a further 3 months until the end of June 2021 to support valued services like leisure centres, theatres and car parks.
- In order to provide further stability to the sector, the Government has decided not to proceed with a reset of business rates baselines in 2021-22, and will maintain the 100% business rates pilots for another year.
- A new £7.1 billion National Home Building Fund, on top of our existing £12.2 billion Affordable Homes Programme. Part of our commitment to build the homes the country needs, as we build back better.
- Councils with access to over £1 billion of spending for social care through £300 million of new social care grant and the ability to continue with a 3% adult social care precept. This funding is additional to the £1 billion social care grant announced last year which is being maintained in line with the government's manifesto commitment.
- The settlement also includes maintaining the New Homes Bonus and an extra £16 million to support the cyber security systems of local authorities.
- Supporting places, such as former industrial areas, deprived towns and coastal communities, by setting out what the UK Shared Prosperity Fund (UKSPF) will invest in, how it will be targeted and how it will work directly with local councils. Growing the national economy, one local economy at a time. The Government will provide a further £220 million of UK-wide funding to support our communities to pilot programmes and new approaches.
- Providing £254 million (a 60% cash increase) to support rough sleepers and those at risk of homelessness.
Key political points on local taxes:
- We are giving councils the flexibility to defer utilising the 3% social care precept for a year, recognising the pressures that many local taxpayers will face next year
- This means locally elected councillors can choose how best to support their residents.
- It is incumbent on councillors to balance the issues and determine how best to deliver good local services, while taking into consideration the circumstances of residents.
- This is in line with our manifesto commitment to continue to protect local taxpayers from excessive council tax increases.
- Council tax in 2020-21 is lower in real terms than it was in 2010.
- We are providing £670 million in council tax support funding to help the more than 4 million households that are least able to afford council tax payments.
