Provisional Local Government Finance Settlement 2022/23: Consultation Response

Our consultation response sets out our assessment of the government’s provisional local government finance settlement for 2023–24.

We welcome the increased funding made available through the Autumn Statement, particularly the decision to delay adult social care charging reforms and retain earmarked funding for frontline services.  

At the same time, the response makes clear that significant structural pressures remain for county and county unitary authorities, driven by inflation, rising demand for care, and outdated funding formulae.  

While the settlement provides some short‑term relief, we argue that it does not place local government on a sustainable financial footing over the medium to long term.

Data set out in the consultation response reveals:

• County and county unitary councils face around £3.5bn of demand and inflationary pressures across 2022–23 and 2023–24.
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• Only one in five County Councils Network members felt confident setting a balanced budget for 2023–24 without further support.
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• Achieving headline Core Spending Power increases assumes councils levy the full 5% council tax increase.
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• Key funding formulas for adult social care and local services are over a decade out of date.

Recommendations to government ahead of the final settlement include:

• Provide multi‑year financial settlements beyond 2024‑25 to improve stability and planning.
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• Urgently progress the Fair Funding Review and update needs‑based funding formulas.
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• Ensure social care funds are used flexibly to support workforce stability and market sustainability, not only fee uplifts.
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• Avoid relying excessively on council tax increases to fund core services in county areas.