Local authority general fund earmarked and unallocated reserve levels, 2017-18 to 2021-22
Updated 25 July 2023
Applies to England
© Crown copyright 2023
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This publication is available at https://www.gov.uk/government/publications/local-authority-general-fund-earmarked-and-unallocated-reserve-levels-2017-18-to-2021-22/local-authority-general-fund-earmarked-and-unallocated-reserve-levels-2017-18-to-2021-22
The Department for Levelling Up, Housing and Communities (DLUHC) collects data on local authority reserve levels on an annual basis as part of its local authority revenue expenditure and financing revenue outturn collection, which is published as national statistics. In a policy statement published in December 2022 DLUHC announced its intention to release a user-friendly publication of the revenue outturn reserves data, with the aim of supporting council members and local electorates to understand the reserves that their local authorities are holding and what they are used for. This publication is the delivery of that commitment. It is also part of ongoing work to provide time-series data for various local government finance series, as identified in the 2021-2022 local government finance data review.
Reserves are an important part of the resourcing available to local authorities and are held for a variety of purposes. Some reserves are held as a general cushion against uneven cashflows and a contingency against unexpected expenditure; these are referred to in the revenue outturn as unallocated reserves. Other reserves are earmarked by an authority for specific purposes, such as to mitigate specific risks or to build up funds for known or anticipated future expenditure. These are known as earmarked reserves. The extent to which earmarked reserves can be made available for other purposes varies depending on the reasons a particular reserve is being held. Some reserves are ringfenced by accounting practice or statute and are not available for spend elsewhere.
This document brings together local authority revenue outturn reserves data from the last 5 financial years 2017-18 to 2021-22. Included are reserves reported in the revenue outturn collection as “other earmarked financial reserves” (line 915) and “unallocated reserves” (line 916), referred to collectively here as “general fund earmarked and unallocated reserves”. We have also included the breakdown of the earmarked reserves subcategories (1023-1027), introduced for the first time in 2021-22. As well as being presented in absolute terms, general fund earmarked and unallocated reserves are expressed as a percentage of both (a) net revenue expenditure and (b) total service expenditure. For relevant years, the other earmarked financial reserves figures have been adjusted to account for timing effects of grants relating to COVID-19, particularly additional business rates relief grants.
The publication does not include data on the public health, schools, dedicated schools grant (DSG) and housing revenue account (HRA) reserves reported separately in the revenue outturn collection. This is because these reserves are ringfenced and cannot be reallocated to other purposes. It should be noted, however, that some funds reported in the revenue outturn as “other earmarked financial reserves” and included in this publication may be ringfenced, where for example reserves relate to grants with conditions that they are spent on specific services.
Further information on an individual local authority’s reserves can be found in the financial accounts published by that authority.