Councils across the UK are going to receive an emergency Government bailout, following warnings of further bankruptcies.

A ministerial statement this afternoon will confirm upper-tier councils’ allocation of £500 million for adult and children’s social care in 2024/25.

Lower-tier district authorities will also receive a funding boost worth between £30-40 million.

A change to local finance settlement this late is “unusual”, but emergency extra funding will prevent the immediate threat of multiple councils issuing bankruptcy notices, a senior council source told PA.

Levelling Up, Housing and Communities Secretary Michael Gove's £500m cash injection may save a number of cash-strapped councils

The bailout comes as Rishi Sunak faced pressure from more than 40 Conservative MPs to give at-risk councils a greater funding settlement.

The Tory backbenchers, with organisation from the County Councils Network, signed a letter to the Prime Minister warning of the consequences of inaction – councils would be forced to axe frontline services and raise council tax in an election year.

The Government also met with district council leaders on Tuesday who urged them to rethink the settlement due to the rising costs of fixing homelessness.

Next year’s planned local government finance settlement included a £64 billion funding boost, which The Department of Levelling Up, Housing and Communities said averaged a real terms increase of 6.5 per cent for councils.

The department said the funding would ensure councils can “continue making a difference alongside our combined efforts to level up.

But the total spending power local councils could wield includes council tax hikes – meaning residents would pay more for everyday or essential services.