A turning point for councils: SIGOMA MP Group Chair on the final Local Government Finance Settlement

Posted on March 02, 2026

Our MP Group Chair, Sally Jameson MP, has set out why the final Local Government Finance Settlement represents a significant step forward for councils, with fairer funding and increased Recovery Grant support for SIGOMA authorities:

'For years, authorities in poorer parts of the country were expected to deliver the same services with a far weaker tax base. The move to 100 per cent council tax equalisation [full recognition of councils’ ability to raise revenue locally when allocating grant funding] finally corrects that imbalance, creating a system that recognises structural disadvantage rather than entrenching it.

Equally significant is the government’s decision to retain and uplift the Recovery Grant. Following strong lobbying from my colleagues in Parliament alongside our friends in local government, the final settlement includes a £440 million increase in the Recovery Grant, with 81 percent of that funding—£358 million—going to SIGOMA authorities, the majority of which in the North and Midlands. This is targeted investment where it is needed most, and a clear rejection of the one size fits all approach that defined the austerity years.

Councils such as Sandwell, Sunderland and Wirral will see three‑year Recovery Grant increases of £27.4 million, £23.9 million and £22.7 million respectively, giving them real headroom to stabilise services and plan for the future. Places like my constituency in Doncaster, as well as Barnsley and Stoke‑on‑Trent—too often at the sharp end of cuts — will each receive £10 million in additional Recovery Grant funding over the period, strengthening their ability to protect frontline services.

Crucially, the settlement also delivers fairness in year‑to‑year funding. The Recovery Grant Guarantee ensures that the most deprived councils see a minimum 5 per cent funding increase in 2026/27, providing stability after years of uncertainty. As a result of these changes, more investment is finally going back into those communities that need it most.

Core Spending Power figures underline the scale of the shift. Birmingham, Bradford, Manchester and Derby will all see double‑digit increases, far above the national average of 6.1 per cent, while many other northern and midlands authorities are also comfortably above average. This is what delivery looks like when it is rooted in redistribution, not rhetoric.

There is more to do. We will continue to argue for a system that fully reflects need and avoids future funding cliffs, creating a fairer, more sustainable system of local government finance for the long term.'

You can read the full article in LabourList here.