Local gov finance settlement 2020-21 proposals unveiled

The government has published a consultation document setting out in greater detail its proposals for how to fund local government in 2020 to 2021.

After the Spending Round confirmed that councils will receive the biggest year-on-year real terms increase in funding for almost a decade, local authorities across England can now submit views to the government’s funding proposals for the sector in the next financial year.

The consultation will last for four weeks from 3 October 2019 to 31 October 2019.

The Core Spending Power of local authorities is estimated to rise in real terms by 4.3 per cent to £49.1 billion in 2020 to 2021, an increase of £2.9 billion. As part of this local authorities will be able to access an additional £1.5 billion of funding for adult and children’s social care.

Councils will additionally be provided with increases from wider resources made available from the Spending Round, including High Needs funding for schools and colleges which will increase by over £700 million.

Other proposed approaches include powers for local authorities to raise Council Tax by up to two per cent plus an additional two per cent of adult social care tax before a local referendum has to take place, as well as £900 million for the New Homes Bonus in 2020 to 2021.

Local Government Secretary Robert Jenrick said: “Local authorities have worked hard over the past decade to deliver efficiencies and savings, while continuing to support the running of our vital public services. This year’s settlement sets the sector on a strong and sustainable footing for the future as we look to next year’s Spending Review and a fresh multi-year settlement.

“The government has been listening to local authorities across the country, and the £49 billion funding boost that will come into force from next year is the biggest increase for nearly a decade. It will allow us to provide more support for areas such as adult and children’s social care and make sure that we are supporting the most vulnerable people in our local communities. I look forward to working with local authorities throughout this consultation process and want to ensure that local communities have access to the highest possible levels of service, delivered in an efficient and cost effective way.”