Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Levelling Up, Housing and Communities, with reference to Local Government Association analysis of 28 June 2022 which found that rising energy prices, rising inflation, and National Living Wage pressures are set to add £3.6 billion in unforeseen extra cost pressures onto council budgets in 2024-25, what assessment his Department has made of the effects of that matter on (a) council budgets and (b) the ability of local authorities to maintain public services that are helping communities recover from the pandemic and residents cope through cost of living rises; and what steps his Department is taking to (i) tackle cost pressure on councils and (ii) maintain public services.

The Local Government Finance Settlement makes available £54.1 billion in 2022/23 for local government in England, an increase of up to £3.7 billion on 2021/22.

Inflation forecasts are higher than they were when the settlement was announced. How that interacts with the finances of local government is not straightforward, as not all areas of expenditure will be sensitive to inflation and local authorities may have multi-year contracts, cushioning them from this year’s inflationary increases.