Communities secretary Sajid Javid has confirmed councils will be able to raise the social care precept by 3 per cent in each of the next two years and that £240m is to be diverted from a housing scheme to fund social care services.

Mr Javid said changes to the new homes bonus would “release important funding for adult social care”.

The government is going to introduce a 0.4 per cent growth target from next year so local authorities will only receive new homes bonus payments on housing built above that baseline. In 2018-19 ministers will consider withholding payments from councils which do not meet planning performance targets, said Mr Javid.

He has also reduced the number of years from which legacy payments are paid from six years to five years in 2017-18 before reducing it further to four years in 2018-19.

Increasing the social care precept, which had been widely trailed, is expected to generate up to £208m in 2017-18, and £444m in 2018-19, said Mr Javid.

The Department for Communities and Local Government has yet to publish documents accompanying the settlement. However, a spokesman said the precept changes meant councils would be able to raise a precept of a maximum of 6 per cent over the course of the parliament with a maximum increase of 3 per cent in any one year. This means councils could still choose to levy 2 per cent a year in each year of the parliament.

Mr Javid claimed the precept changes along with the £240m fund would mean an additional £900m for social care over the next two years. However, as changing the profile of the precept to 3 per cent in each of the next two years would only raise around £625m extra over the course of the parliament than the existing 2 per cent a year precept.

Mr Javid highlighted variations in areas’ performance in relation to delayed transfers of care and he said an integration and better care fund policy framework would be published “shortly”.