Today the government announced its first budget since the beginning of the Covid-19 pandemic. The government has set out its commitment of continued support and its path to recovery, but what does the budget mean for the local government sector? In this guide we set out the key takeaways and policy announcements most relevant to the local government sector.
New UK Infrastructure Bank will be set up in Leeds with the aim of funding £40bn worth of public and private projects. It will have an initial £12bn in capital. The bank will provide financing support to the private sector and local authority infrastructure projects across the UK, helping the government meet climate change and regional economic growth objectives.
Build Back Better: our plan for growth, published by the Treasury, sets out the government's plans to support economic growth through significant investment in infrastructure, skills, and innovation. It outlines plans to pursue growth that levels up all parts of the UK whilst support the transition to net zero and the government's vision for a Global Britain.
Offshore Wind, £20m to fund a UK wide competition to develop floating offshore wind demonstrators and help support the government’s aim to generate enough electricity from offshore wind to power every home by 2030.
Long Duration Energy Storage, £68m to fund another UK wide competition to deliver a first of a kind long duration energy storage prototype, to help reduce the cost of net zero by being able to store excess low carbon energy for longer periods.
Local Economic Growth
8 New English Freeports! These international gateways are the first freeports announced in England. These special economic zones will have different tax rules, including generous tax reliefs, customs benefits, and wider government support, making it cheaper to do business. The Freeports will help regenerate regions across the UK by attracting investment, trade and jobs. They will begin operations in late 2021.
Levelling Up Fund, £4.8bn will be made available to local areas to help tackle regional inequalities. Part of the governments wider agenda to close the economic gap between the North and South and changing the country’s economic geography. The first round of funding will start in 2021-22.
High Street Fund, shops and hospitality firms will be able to get a grant from a £5bn fund to help them reopen after lockdown, up to £18,00 per firm. Non-essential retail business will receive grants of up to £6,000 per premises as part of the Restart Grant.
Community Ownerships fund, £150m of funding will be made available for community groups to apply for funds to take over and invest in pubs, theatres, shops or sports clubs at risk of closure.
New Green Bond Savings product, £15bn in green bonds to help finance the transition to net zero by 2050, including for retail investors. Will be issued by NS&I to raise money for environmental projects. Due to be issued this summer so more details still to come.
New Treasury campus in Darlington, with 750 UK civil servants to be relocated and create a northern base. Part of the governments levelling up agenda in closing the economic gap between the north and the south.
Towns Fund, £1bn for promoting regeneration in 45 English towns to support their long term economic and social regeneration as well as their immediate recovery from Covid-19.
MMC Taskforce, MHCLG will establish a Modern Methods of Construction Taskforce to accelerate delivery of MMC homes in the UK. This includes £10m of seed funding and will be based at MHCLG’s new offices in Wolverhampton. The taskforce will work closely with local authorities and mayoral combined authorities.
New Mortgage guarantee system means first time buyers can access mortgages which require only a 5% deposit on properties worth up to £600,000.
Stamp Duty Holiday, a 3-month extension has been announced for the stamp duty holiday, with no stamp duty being paid on the first £500,000 of a property purchase until 30th June. With a staggered reduction to a return of original stamp duty levels in October.