In the past when any Bill authorised or required local authorities in Great Britain to undertake new services or otherwise to incur expenditure, in the absence of express provision to the contrary, the expenditure was by statute taken into account by Ministers when levels of rate support grant were determined. Rate support grant was paid out of voted money, and accordingly a money resolution was required to sanction the relevant expenditure provisions in the Bills concerned.
Under the Local Government Finance Act 1988 and the Abolition of Domestic Rates etc (Scotland) Act 1987 as amended by schedule 6 to the Local Government and Housing Act 1989, revenue support grant is to replace rate support grant. Revenue support grant will be paid out of voted money, but Ministers are not statutorily required to have regard to the level of local authority expenditure when they determine the amount of grant to be paid. I am asked to rule whether a money resolution should continue to be required for Bills which imply increases in local authorities' expenditure.
I am satisfied that revenue support grant will in the future in practice, if not by statute, take account of local authorities' expenditure. I therefore rule that a money resolution will continue to be required in respect of such Bills.