Source · Select Committees · Public Accounts Committee
Recommendation 18
18
The spending review announced on 27 October 2021, covering 2022–23 to 2024–25, provided £4.8 billion...
Conclusion
The spending review announced on 27 October 2021, covering 2022–23 to 2024–25, provided £4.8 billion (£1.6 billion each year) of new grant funding for local authorities.68 It also announced that council tax would be able to rise by 2% each year without triggering a council tax referendum.69 In addition, authorities with social care responsibilities would be able to set a 1% adult social care precept each year.70 Taking these points together, the government estimated that core spending power would rise by 3% each year after taking account of expected inflation.71 Separately, £3.6 billion will be made available to local authorities outside the local government settlement to fund government reforms to the way service users are charged for adult social care.72
Government Response
Not Addressed
HM Government
Not Addressed
5.1 The government agrees with the Committee’s recommendation. Recommendation implemented 5.2 The department recognises the pressures on local services and the importance of a sustainable funding platform. To support services, the 2021 Spending Review settlement provides local authorities with an estimated average annual increase in Core Spending Power of 3% in real terms each year of the Spending Review period, including investment in Adult Social Care reform. By 2024-25 it is expected to rise to around £59 billion. Local government can also expect to receive additional income from 2024-25 from the Extended Producer Responsibility scheme, for managing packaging waste. This funding package ensures local services can respond effectively to rising demand and cost pressures, including adult social care reform. 5.3 The department continues to work closely with the local government sector and other government departments to ensure that councils have the resources to meet pressures and maintain current service levels. Alongside monitoring local authority finances, the department engages regularly with local authorities and other government departments to understand and assess policy outcomes. This includes working closely with the Department for Health and Social Care on plans to deliver a significant package of Adult Social Care reforms, as well as the Department for Education on the upcoming SEND Review and Independent Care Review. The department is working at pace to bring together the qualitative and quantitative information from this work to regularly assess any emerging pressures on the sector, particularly in the context of the war in Ukraine. 5.4 The department wrote to the Committee in April alongside this Treasury Minute with more detailed assurance of the impact of the Spending Review on services and its plans to work with other government departments to keep this under review.