Question to the Ministry of Housing, Communities and Local Government:

To ask the Secretary of State for Housing, Communities and Local Government, what assessment has she made of the financial pressures on councils caused by the levels of and interest on the debt they owe to the Treasury.

Under the current system, local authorities are responsible for their own borrowing and investment decisions and must ensure that all borrowing is prudent, affordable and sustainable within their overall budgets.

The government is making good on long overdue promises to fundamentally update the way we fund local authorities. We are delivering fairer funding, targeting money where it is needed most through the first multi-year Settlement in a decade.

The final 2026-27 Local Government Finance Settlement makes available £78 billion in Core Spending Power for local authorities in England in 2026-27, a 6.1% increase compared to 2025-26. By the end of the multi-year Settlement (2028-29), the government will have provided a 15.5% increase in Core Spending Power for local authorities in England, worth over £11.4 billion, compared to 2025-26.

The majority of funding in the Local Government Finance Settlement is unringfenced recognising that local leaders are best placed to identify local priorities.