Thank you for contacting me about local government spending power.
Let me start by saying that I fully recognise the important and tireless efforts undertaken by local councils during the pandemic. Their crucial contribution to everyday life in our communities, especially when it comes to helping those most vulnerable, has certainly not gone unnoticed by the many people who have received support.
I am therefore pleased that the Government has made available a 4.6 per cent cash terms increase in councils’ Core Spending Power for 2021-22. This represents an increase of £2.3 billion and means that up to £51.3 billion will be available to local authorities this year. This builds on the back-to-back increases of recent years which, for example, have seen Core Spending Power grow by 4.4 per cent and 2.8 per cent in 2020-21 and 2019-20 respectively.
It is encouraging to see additional support for the vital services that local authorities provide. For example, funding to address homelessness and rough sleeping is being raised to over £750 million this year. This leads on from the £700 million made available in 2020-21, and I am confident that this additional funding will provide local communities with the resources they need to recover from the pandemic and beyond.
The pandemic has presented many difficulties for local councils, many of whom have seen significant increases in spending to be able to deliver local services. As such, the focus of Government support has been to drive forward recovery and renewal plans, and to maintain critical services. I am glad that an unprecedented package of financial support was put in place, totalling over £12 billion. On top of this, a phased repayment of council tax and business rates deficits over three years rather than one has been announced too.
Looking to the future, I am told that the Government will be assessing the demand faced by councils and the resources available to meet them, and final decisions related to this will be taken in the context of this year’s Spending Review.
Thank you again for taking the time to contact me about this issue.
Sally-Ann Hart MP