COUNCILS in England will see their spending power cut by 1.7 per cent next year, Local Government Secretary Eric Pickles announced today.

He told MPs the settlement represented a "bargain" for local authorities, adding that the Government would offer support for the third year so that council taxes could be frozen.

Mr Pickles described the funding arrangements, which will take effect from next April, as a "watershed moment", with power shifted from Whitehall to town halls.

"This settlement recognises the responsibility of local government to fund sensible savings and make better use of resources," he said.