Leicestershire County Council has set aside £2 million to cover the cost of assisting the inquiry into Greville Janner's alleged sexual abuse of boys in its care.
The authority ran the children's homes in the city and county, where the former Labour politician allegedly met, groomed and sexually assaulted boys.
It believes the £2 million will cover the cost of legal representation and digging out documents and other relevant material from its past.
It said the cash would also would cover the cost of supporting the welfare of alleged abuse victims.
The council will give an account of its actions to the Independent Inquiry into Child Sexual Abuse, (IICSA) later this year.
The veteran Labour politician – who was accused of 22 sexual offences against boys between 1963 and 1988 – died, aged 87, shortly before Christmas.
His death ended the prospect of his alleged victims' evidence ever being tested in a criminal court.
The IICSA, which is chaired by Justice Lowell Goddard, will hear the testimonies of alleged victims of the former Leicester West MP, and then issue a "finding of facts''
Leicestershire Police and the Labour Party have also been asked to give evidence to the inquiry as it examines issues such as why Janner was not charged with offences against children when he was alive and well and what was known about his sexual interest in children.
His family says he was innocent of any wrongdoing.
County council leader Nick Rushton said of the broad inquiry: "The abuse of children is totally unacceptable and it is vital that the voices of people who were abused are heard. We remain fully committed to co-operating with the inquiry to ensure that events are fully investigated and any lessons learned.
"Clearly, preparing for an unprecedented event on this scale is significant and challenging and we're taking our role extremely seriously.
"By adopting a thorough approach, we're ensuring we provide the most comprehensive and accurate information possible, supporting the inquiry's investigation."
The Janner investigation is one of 12 strands of a broad inquiry into allegations of sexual abuse by significant public figures, including those within the Anglican and Catholic churches.
The Janner strand is expected to take six months to complete, while the broader inquiry could run until 2020.
Last year, Director of Public Prosecutions (DPP) Alison Saunders said Lord Janner was too ill with Alzheimer's disease to stand trial.
In announcing her decision, the DPP revealed Lord Janner should have been charged with offences against children following previous police investigations in 1991 and 2002.
However, police requests to charge him were declined by the Crown Prosecution Service on at least two occasions.
