Recommendation 8

In addition to the March and April unringfenced funding, the Department provided two further tranches of unringfenced funding in 2020–21, bringing the total value of these grants to £4.55 billion. The Department took us through the ways in which its approach to allocating unringfenced funding changed. It used three different approaches (existing funding formulas, population, and a new formula drawing on pandemic data returns) to allocate funding of £3.7 billion between March and July 2020. Since July 2020 the approach to funding allocation has been stable, although when asked if the current formula needed further revision the Department did not commit itself either way.16 By early December 2020 estimated financial support for the sector from the Department in unringfenced grants and support for sales, fees and charges income losses, funding from other government departments, and support from clinical commissioning groups stood at £9.1 billion. In December 2020 authorities estimated their full COVID-19 costs pressures and income losses for 2020–21 at £9.7 billion.17 Departmental data on local authority financial resilience during the pandemic