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Local Government: Borrowing

Question for Ministry of Housing, Communities and Local Government

UIN 57960, tabled on 10 June 2020

To ask the Secretary of State for Housing, Communities and Local Government, what assessment he has made of the potential merits of allowing local authority greater autonomy on freedom to borrow for revenue funding as a result of the covid-19 outbreak.

Answered on

18 June 2020

We are committed to ensuring that councils are managing as the pandemic progresses. The Government has backed councils with £3.2 billion of extra funding, as part of a wider £27 billion support package for communities, to ensure they can meet the unique pressures that the COVID-19 pandemic has placed upon them, both in terms of expenditure pressures and their income.

In addition, we have also taken a number of measures to support immediate cash flow concerns, namely deferring £2.6 billion in local authority payments of the Central Share of retained business rates and making an upfront payment of £850 million in social care grants. Central Share payments due to government in April, May and June will instead be spread over the second half of the year. The restrictions on the use of capital resources ensure that such resources are available for long-term investment.