Chapter 2: Other Provision Local government capital finance New section 12B: Risk thresholds
Subsection (1) establishes a process for assessing whether an authority’s risk is excessive, by requiring Secretary of State to have regard to metrics in determining whether it is appropriate to the use the statutory powers. These capital risk metrics are how risk thresholds will be identified.
	Subsection (2) defines capital risk metric’ in reference to debt, capital and provision for repayment. It also provides a power to the Secretary of State to set further such metrics.
	Subsection (3) allows the Secretary of State to make regulations regarding the thresholds for capital risk metrics and how the metrics should be calculated.
	Subsection (4) imposes a duty to consult local authorities when setting additional metrics.
	Subsection (5) provides definitions for ‘capital asset’, ‘minimum revenue provision’ and ‘specified’ as set out in this section.
	Subsection (6) stipulates that particular thresholds might be set out in guidance.