Employers' Contributions and Minimum Wage
The question
To ask the Secretary of State for Housing, Communities and Local Government, whether local authority core funding will include funding for proposed changes to (a) employers National Insurance contributions and (b) the minimum wage.
Answered by Jim McMahon
We have announced £1.3 billion of new grant funding in 2025/26 for local government to deliver core services. Together with local income from council tax and locally-retained business rates, this will provide a real-terms increase in total core spending power of around 3.2%, which can be used to address the range of pressures facing local government.
The Government has committed to provide support for departments and other public sector employers for additional employer NICs costs. This applies to those directly employed by the public sector, including local government.
The New Burdens Doctrine does not apply to policies which apply the same rules to local authorities and to private sector bodies (for example changes in general taxation, or employment legislation that applies to all organisations), unless these have a disproportionate effect on local government.
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