Local Government Finance
The question
To ask the Secretary of State for Housing, Communities and Local Government, with reference to Local authority capital expenditure and receipts in England: 2024 to 2025 final outturn, Published 6 November 2025, what proportion of the £3.0 billion of total capital receipts in 2024-25 was subject to the Flexible Use of Capital Receipts direction that allows such receipts to spent on revenue expenditure.
Answered by Alison McGovern
The Flexible Use of Capital Receipts general direction was introduced in 2016 by the previous government and remains substantively unchanged.
The total value of capital receipts received by local authorities in 2024-25 was £4.3 billion, as reported on gov.uk here.
This government has not changed the rules on use of capital receipts; not all capital receipts are eligible for use under the general flexibility. For example, under the direction, eligible capital receipts must be genuine disposals outside of the local authorities’ group structure. Nor does the flexibility override any statutory restrictions that may exist on certain types of assets. The government does not collect specific data on eligible capital receipts held by local authorities.
Use of the flexibility is at the discretion of local authorities but must be compliant with the conditions of the general flexibility and their wider statutory duties. The government is clear that its use should represent value for money and be in the best interests of local residents.
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