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Autumn statement 2022: key measures

Local Government Lawyer identifies some of the key measures affecting local government and connected sectors from Chancellor of the Exchequer Jeremy Hunt’s Autumn Statement.

Source: Autumn Statement 2022, published by HM Treasury on 17 November 2022.

See also:

Devolution and Levelling Up

New devolution deals - The government has agreed a new mayoral devolution deal with Suffolk County Council, and will shortly be agreeing a mayoral deal with Cornwall Council and an expanded mayoral deal with local authorities in the North East of England. Good progress is also being made towards signing a deal with Norfolk County Council. Once agreed, these deals, taken together, will increase the proportion of people living under a directly elected mayor with devolved powers in England to over 50%.

Trailblazer devolution deals - The government will deliver the Levelling Up White Paper commitment to sign new ‘trailblazer’ devolution deals with Greater Manchester and the West Midlands Combined Authorities by early 2023. The government is in discussion with the Mayors of these areas to devolve powers to deliver levelling up in areas such as skills, transport and housing, including through consolidating funding. These ‘trailblazer’ deals will act as a blueprint for other areas to follow.

Single settlements for mayoral combined authorities - As part of negotiations on trailblazer deals, the government will explore with Greater Manchester Combined Authority and West Midlands Combined Authority the potential to provide single departmental-style settlements at the next Spending Review. This could give local partners more flexibility and accountability over key economic growth funds, moving away from competitive bidding processes. Subject to progress of these discussions, the government will consider the eligibility of other mayoral combined authorities for these settlements, noting the need to ensure appropriate accountability structures are in place.

Levelling Up Fund - The second round of the Levelling Up Fund will allocate at least £1.7 billion to priority local infrastructure projects. Successful bids will be announced before the end of the year.

Investment Zones

Investment zones - The government will refocus the Investment Zones programme to catalyse a limited number of high potential clusters, working with local stakeholders, to be announced in the coming months. The existing expressions of interest will therefore not be taken forward.

Council Tax

Council Tax flexibility - The government is giving local authorities in England additional flexibility in setting council tax by increasing the referendum limit for increases in council tax to 3% per year from April 2023. In addition, local authorities with social care responsibilities will be able to increase the adult social care precept by up to 2% per year. This will give local authorities greater flexibility to set council tax levels based on the needs, resources and priorities of their area, including adult social care.

Adult Social Care

Central government adult social care and discharge funding increase - The government is investing an additional £1 billion of central government funding in England in 2023-24, increasing to £1.7 billion in 2024-25 to get people out of hospital on time and into social care. £600 million in 2023-24 and £1 billion in 2024-25 will be allocated through the Better Care Fund. The remaining £400 million in 2023-24 and £680 million in 2024-25 will be allocated to local authorities through a ringfenced adult social care grant which will also help to support discharge.

Adult social care charging reform in local authorities - The government is responding to the concerns of local government by taking the difficult decision to delay the national rollout of social care charging reforms from October 2023 to October 2025. Funding for implementation will be maintained within local government to enable local authorities to address current adult social care pressures. This will be allocated at the Local Government Finance Settlement through the Social Care Grant.

Health

NHS funding - The government is providing additional funding of £3.3 billion in each of the next 2 years to support the NHS in England in response to the significant financial pressures it faces, and enabling rapid action to improve emergency, elective and primary care performance.

Review of Integrated Care Boards - The government has asked former Health Secretary Patricia Hewitt to lead an independent review into oversight of Integrated Care Boards in England and how they can best work with autonomy and accountability.

NHS workforce plan - The government is publishing a comprehensive NHS workforce plan, including independently verified workforce forecasts, next year. This will include measures to make the best use of training to get doctors, nurses and allied health professionals into the workforce, increase workforce productivity and retention.

Education

Core Schools Budget Uplift - The government has decided to increase the core schools budget by £2.3 billion in 2023-24 and a further £2.3 billion in 2024-25. After adjusting Spending Review 2021 budgets down to account for the removal of the compensation for employer costs of the Health and Social Care Levy, this brings the core schools budget to a total of £58.8 billion in 2024-25, £2 billion greater than published at Spending Review 2021.

Housing

Social housing rent cap - The government is supporting people in social housing in England with the cost of living by limiting the increase in their rents. Under current rules, rents could have risen by up to 11.1% – but now they will only be able to rise by a maximum of 7% in 2023-24. This will save the average tenant in the social rented sector £200 next year and will generate an overall saving to government of around £630 million over 5 years.

Business rates

Overall Package - From 1 April 2023, business rate bills in England will be updated to reflect changes in property values since the last revaluation in 2017. A package of targeted support worth £13.6 billion over the next 5 years will support businesses as they transition to their new bills, protect businesses from the full impact of inflation, and support our high streets. English Local Authorities will be “fully compensated for the loss of income as a result of these business rates measures and will receive new burdens funding for administrative and IT costs”.

Retail, Hospitality and Leisure Relief - Support for eligible retail, hospitality, and leisure businesses is being extended and increased from 50% to 75% business rates relief up to £110,000 per business in 2023-24.