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25.02.20

Government confirms £49.2bn spending increase for councils

The Ministry of Housing, Communities and Local Government has today (Feb 25) announced a £49.2bn investment into local council funding, the largest increase in councils’ spending power for a decade.

The Local Government Secretary, Rt Hon Robert Jenrick MP made the multi billion pound announcement following a vote in the House of Commons, which will see an increase of £2.9bn or 4.4% in real terms.

As part of the settlement, almost £6bn in total will be dedicated to funding the support of adult and children’s social care in 2020 to 2021, funding more care home places and meeting rising demand from the most vulnerable in society.

It will also work to manage the rise in council tax for residents, which is expected to make average council tax increases for 2020 to 2021, the lowest since 2016 to 2017.

Under the New Homes Bonus scheme in 2021 to 2021, local authorities will be financially rewarded for the number of new homes they build, with £907m put aside to boost housing growth.

The Rural Services Delivery Grant will remain at £81m to ensure the needs of rural areas are met. Other financial protection includes core funding, ensuring the continued running of statutory services relied on by residents and £40m redistributed to the business rates levy.

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.”

Following the publication of provisional finance settlement plans in December, over 200 representations from a range of organisations and ministers met with local councils, MPs and the Local Government Association.

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