Extra £500m and supportive measures announced for councils

An additional £500m funding package and further support for Councils has been announced today (July 2) by Local Government Secretary Robert Jenrick.

The new support will help local authorities to cover income lost during the pandemic, relieve spending pressures and plug any financial holes than have emerged over recent weeks.

The ‘un-ringfenced’ funding, brings the total fiscal support for local councils to £4.3bn, and makes up part of a wider £27bn package to help councils, businesses and communities.

In addition, a new scheme introduced by Government today, will help to reimburse lost income and boost cash flow, by covering 75p of every pound lost where losses are more than 5% of a council’s planned income.

The Government is also changing the regulations to allow Councils to spread their tax deficits over three years rather than the usual one.

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Local Government Secretary Robert Jenrick MP said:

“Councils are playing a huge part in supporting their communities during this pandemic. From supporting the most vulnerable and keeping vital services running to operating local track and trace, council workers have been at the forefront of this great national effort and are the unsung heroes of this pandemic. 

“Today I am providing a further package of support that takes our support for councils during this pandemic to £4.3 billion to help meet the immediate pressures councils are facing. I know that the loss of revenue from car parks and leisure centres has created huge difficulties, so I am introducing a new scheme to help cover these losses. This Government will continue to stand shoulder to shoulder with councils and communities as we recover from this pandemic as we renew our commitment to unite and level up the country.”

It comes after the announcement yesterday (June 1) of the fast tracking of £96m Towns Fund investment to boost activity in town centres and high streets and enhance public spaces, cycle lanes and more.

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