Government publishes the final Local Government Finance Settlement report for 2020/21

posted on 13 February 2020, updated on 13 February 2020

On 6 February 2020, the government published the final Local Government Finance Settlement report for 2020/21. This lays out the government’s proposals for funding local authorities in England in the coming financial year through central grants and redistribution of business rates.

The policy proposals in the final settlement are;

  • an expanded social care grant totalling £1.5 billion
  • core settlement funding grants to local authorities remain the same as in 201920, uprated in line with the change to the business rates multiplier (which is itself linked to inflation)
  • most council tax referendum thresholds are set at 2%, with an extra 2% for authorities responsible for social care services
  • £907 million of funding for the New Homes Bonus
  • an Improved Better Care Fund at the same levels as in 2019-20
  • most pilots of 100% or 75% business rates retention will end
  • £80 million for the Rural Services Delivery Grant.

Most authorities will be set a council tax referendum threshold of up to 2%. Unitary and county authorities will be permitted an additional 2% threshold for a ‘Social Care Precept’. District councils will be set a threshold of up to 2% or £5 on a band D council tax bill, whichever is the higher. No threshold will be set for combined authorities or parish and town councils.

A motion to approve the settlement will be debated in the House of Commons on Wednesday 12 February.

You can find more information on the website.

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