£78 billion for councils to cut deprivation

Councils in England are set to receive almost £78 billion for essential services next year.

The government has announced an overhaul of how local government is funded.

The money is aimed at restoring pride and opportunity in left behind places, with councils to have more resources to bring back libraries, youth services, clean streets and community hubs.

The funding is part of the first multi-year funding Settlement in over a decade, giving councils three years of financial certainty so they can plan ahead rather than firefight year to year.

By the end of this multi-year Settlement, councils will see an increase of over 23 per cent in their core spending power compared to 2024-25 to pay for services.

Areas will now be funded using an evidence-based system that properly recognises local circumstances and the true costs of providing services in deprived communities.

As a result, the most deprived 10 per cent of councils will see a 24 per cent per head boost.

Secretary of State Steve Reed said: "This is a chance to turn the page on a decade of cuts, and for local leaders to invest in getting back what has been lost – to bring back libraries, youth services, clean streets, and community hubs. 

"Today we’re making sure every community has the funding they need to succeed."

Minister of State for Local Government and Homelessness, Alison McGovern said: "Deprivation doesn’t happen by accident – it’s the result of years of broken systems and wrong priorities. This settlement tackles that head-on by directing funding where it’s needed most.  

"By fixing the link between funding and deprivation, we’re giving local areas the tools to create opportunities, support families, and rebuild the services that hold communities together. This is how we deliver a fairer Britain where everyone has the chance to succeed."