Local Government Act 1974

2 Elements of rate support grants

(1) The aggregate amount of the rate support grants for any year shall be divided by the Secretary of State into three elements, to be known respectively as " the needs element", " the domestic element " and " the resources element ", and the aggregate amount of the needs element and of the domestic element and the estimated aggregate amount of the resources element shall be such as may be prescribed.

(2) Subject to the following provisions of this section, payments in respect of the elements of rate support grant shall be made to a local authority at such times as the Secretary of State may with the consent of the Treasury determine, and shall be made in aid of the revenues of the authority generally; and the provisions of Schedule 2 to this Act shall have effect with respect to the determination of the amounts payable to any local authority in respect of those elements for any year.

(3) Except as provided by subsection (4) below, no payment in respect of the needs element shall be made to the council of a non-metropolitan district and the Secretary of State may by regulations provide that such proportion as may be determined by or under the regulations of the amount which, apart from the regulations, would be payable in respect of the needs element for any year—

(a) to the council of a London borough or the Common Council of the City of London, or

(b) to the council of a metropolitan district,

shall be payable instead to the Greater London Council or, as the case may be, to the council of the metropolitan county in which the district is situated; and any such regulations may make different provision in relation to different councils.

(4) The Secretary of State may by regulations provide that such proportion as may be determined by or under the regulations of the amount which, apart from the regulations, would be payable in respect of the needs element for any year to the council of a non-metropolitan county shall, in such cases as may be determined in accordance with the regulations, be payable instead to the councils of districts situated in the county; and any such regulations may make different provision in relation to different councils.

(5) No payment in respect of either the domestic element or the resources element shall be made to a county council or the Greater London Council.

(6) Any amounts payable to a local authority in respect of the domestic element shall be taken into account for the purposes of this and any other Act as if they were payable on account of rates.

(7) Subject to subsection (8) below, the Secretary of State may—

(a) defray any expenditure incurred in any year in the provision of services for local authorities by any body specified in regulations made by the Secretary of State ; and

(b) deduct from the aggregate amount of the needs element for that year such amount, not exceeding the total of the expenditure so defrayed, as appears to him to be appropriate.

(8) Before exercising his powers under subsection (7) above, the Secretary of State shall consult with such associations of local authorities as appear to him to be concerned and with any local authority with whom consultation appears to him to be desirable.