Communities Secretary James Brokenshire said in a message to the Treasury, cited by the Telegraph newspaper, that his department had received less than a half of the sum requested.
Brokenshire reportedly warned that the 35 million pounds ($44.4 million) were not enough to avoid a "significant risk of disruption" as councils prepare to welcome back expats.
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The outlet added that at least one other department had made a similar complaint about lack of funding if the country leaves the European Union in March without agreeing exit terms with Brussels.
