How were councils protected against large changes in their allocation?
After we had calculated each council’s share, we compared them with the previous year and gave some councils extra support. This was done by setting a limit to the percentage reduction that they were allowed. The limit is called ‘the Floor’.
We worked out the average percentage change, comparing all bar a few areas of the formula. We then set the Floor slightly below that average. It meant that in 2020-21 councils were allowed, at worst, a 0.44% reduction.
Any council above the Floor paid into a pool. This pool was then distributed to the other councils to bring them up to the Floor.
In 2020-21 about £62 million was reallocated in this way.