Michael Gove set to announce 6.5% increase in funding to stricken councils

It comes amid growing fears about the number of local authorities facing effective bankruptcy.

Gove is set to announce a 6.5% increase in funding for councils in England, according to reports (Stefan Rousseau/PA) (PA Wire)

Michael Gove is set to announce a 6.5% increase in funding for councils in England, according to reports, amid growing fears about the number of local authorities facing effective bankruptcy.

The Financial Times said that the Communities Secretary would provide increased government assistance for English local councils, with a provisional package for 2024/25 worth around £64 billion.

Council leaders across the country are grappling with major shortfalls in their finances, with Birmingham City Council and Nottingham City Council among those declaring themselves essentially bankrupt in recent months.

The spate of crises facing local authorities has prompted concern about the provision of public services for communities, with the new funding perhaps unlikely to address all the pressures.

Metro mayors from West Yorkshire, Greater Manchester, Liverpool and elsewhere have called on Mr Gove to provide extra finances for struggling councils.

Budgets came under pressure in the years of Conservative-imposed austerity after the financial crash, with the pandemic and inflation compounding the woes facing councils.

The reported funding increase is above the latest October inflation rate of 4.6%, but it may still disappoint some under-pressure town halls.

The Department for Levelling Up, Housing and Communities has been contacted for comment.