£100m boost to council coffers as they help communities through the credit crunch

Published	23 February 2009

Local Government Minister John Healey has today confirmed that 360 councils will receive their share of £100million within the next few days, to be used as they see fit to help meet local needs and priorities - particularly helpful in this difficult economic climate.

This extra funding comes from the Local Authority Business Growth Incentives Scheme (LABGI) scheme that has been in operation since 2006, and rewards councils for successfully promoting economic growth in their area.

In his speech to the New Local Government Network last month, Prime Minister Gordon Brown confirmed that the Government would release the last £100million funding through the scheme, helping councils respond flexibly to the impact of the downturn on their communities.

And today, John Healey confirmed the share that councils will get.

John Healey said:

"Over the last three years, the LABGI scheme has made a real difference to local communities - in these difficult economic times, it has an even more important role to play.

"Different parts of the country will be affected by this downturn in different ways and to different degrees - as these pressures are being felt by families and businesses, councils are best placed to provide real help locally, tailored to local needs, to help people to stay in their homes and their jobs.

"So I am pleased to be able to confirm the share of £100m that councils will get, with no strings attached and extra to the core grant they receive, which will be a real boost to councils' coffers as they provide much-needed support to their communities - particularly in these tough economic times."

The £100m LABGI payment is extra to the Local Government Finance Settlement. Next year - the second in the first-ever three-year settlement - local government will benefit from a 4.2 per cent increase in funding.

Notes to editors

1. The breakdown of funding to councils is published on Communities and Local Government website and can be found at: www.local.communities.gov.uk/finance/labgi.htm (external link).