Final Settlement confirmed for council budgets

The final Settlement will give a a 6.8 per cent increase in cash terms in councils’ Core Spending Power compared to 2024-25.

The government will be providing up to £3.7 billion additional funding to social care authorities. This includes an £880 million uplift to the Social Care Grant, compared to 2024-25.

Meanwhile, a new £270 million Children’s Social Care Prevention Grant will support the national roll out of family help, intended to keep children safe and ensure they get the best start in life.

The 5 per cent referendum principles on council tax increases.

Deputy Prime Minister, Angela Rayner said: "Councils deliver vital services across the country – driving growth and local economies and providing a lifeline for those that need it most.  

"Through our Plan for Change we are determined to fix the foundations of local government; investing where it is needed, trusting local leaders and working together to deliver growth, better health and social care services and the affordable homes people need."

Minister of state for local government and English devolution, Jim McMahon OBE said: "We have been clear we will fix the foundations of local government. That means an end to short-term solutions and instead rebuilding the sector to put councils on a more stable and secure footing.

"Local leaders play a crucial role in delivering the day-to-day services communities across the country rely on, which is why we want to work with them towards a fairer funding model that tackles regional inequality and prioritises outcomes for local people."

In response to the announcement, Cllr Louise Gittins, chair of the Local Government Association, said: “Extra money for councils next year, including compensation for employer national insurance contributions increases, will help meet some of the cost and demand pressures they face but still falls short of what is desperately needed to cover them all.

“This financial year therefore remains extremely challenging for councils of all types who now face having to increase council tax bills to bring in desperately needed funding next year yet could still be forced to make further cuts to services. Wherever possible they will be working alongside their local partners to innovate and try and protect the services that people rely upon as much as they can.

“Councils also recognise that having to increase council tax places yet more financial burden on households. We remain clear to Government that it is not the answer to meeting the long-term pressures facing high demand national services.

“The forthcoming Spending Review will be critical to the future of our local services and must include significant and sustained increases in overall funding for councils.

“However, this alone will not address the multiple issues with the way local services are funded. Councils stand ready to work with the Government on creating an improved and a more sustainable future funding system that works for the whole of local government.”