This extra funding comes from the Local Authority Business Growth Incentives Scheme (LABGI) scheme that has been in operation since 2006, and rewards councils for successfully promoting economic growth in their area.
In his speech to the New Local Government Network last month, Prime Minister Gordon Brown confirmed that the Government would release the last £100million funding through the scheme, helping councils respond flexibly to the impact of the downturn on their communities.
John Healey confirmed the share that councils will get. He said "Over the last three years, the LABGI scheme has made a real difference to local communities – in these difficult economic times, it has an even more important role to play.
"Different parts of the country will be affected by this downturn in different ways and to different degrees – as these pressures are being felt by families and businesses, councils are best placed to provide real help locally, tailored to local needs, to help people to stay in their homes and their jobs.
"So I am pleased to be able to confirm the share of £100 million that councils will get, with no strings attached and extra to the core grant they receive, which will be a real boost to councils' coffers as they provide much-needed support to their communities – particularly in these tough economic times."
The £100 million LABGI payment is extra to the Local Government Finance Settlement. Next year, the second in the first-ever three-year settlement, local government will benefit from a 4.2 per cent increase in funding.
