The recovery continues

Posted on February 16, 2026

Writing in The MJ, our Chair, Cllr Sir Stephen Houghton, reflects on SIGOMA’s fair funding campaign and explains how our key asks have helped shape the foundations of the new fairer funding system.

Over the last 15 years, the most deprived authorities have faced devastating real-term cuts, while many of the least deprived councils have seen increases in funding. The local government finance system was broken. Seizing the opportunity presented by the government's Fair Funding Review, we launched our campaign ‘Towards a Fairer Future' to lobby for a fairer funding system, and we are pleased that our key asks have formed the foundation of the new system.

Funding based on deprivation and need is the cornerstone of the new, fairer system. The clearest example of targeted, deprivation-based funding is the Recovery Grant, and the boost to this crucial funding is strongly welcome. Introduced by the Government last year, the Recovery Grant was a lifeline for many of our members representing the most deprived communities.  Our members benefitted from three quarters of this additional funding, delivering on the Government's commitment to direct funding to the areas that need it the most. 

But the Recovery Grant did more than help councils make ends meet: it was a transformative investment, widely welcomed by members for enabling them to invest in new services for the first time in over a decade. For example, in Barnsley, it equipped struggling families with school uniforms, and the ‘Love Where You Live' scheme continues to address the increasingly important issue of local pride.

As the Government has rightly said, ‘the recovery is not over', and the £440m uplift to this vital funding means that the most deprived areas in the country can continue to rebuild from the damaging impact of austerity. The next step is for the Recovery Grant to be made permanent to ensure that funding continues to be targeted to the areas that need it the most.  

Council tax equalisation is also essential to rebalancing the system. This ensures that an area's ability to raise council tax is fully accounted for when allocating grant funding. Under the previous system, the disconnect between council tax and grant funding meant that authorities were able to keep the tax disproportionately low.

For example, a Band A property in Blackpool, the most deprived authority in England, has a bill of almost £1,600, whereas in Westminster, residents pay half of that, despite having significantly higher-value properties. Council tax equalisation will mean that more affluent areas can no longer benefit from this discrepancy: a key step toward aligning funding with need.

Tackling the sizeable and ever-increasing SEND deficits is crucial to building a sustainable funding system, and we strongly welcome the Government's proposal to address these. Spiralling SEND costs are an increasing pressure for our members, and this proposal is an important step toward easing this substantial burden. We look forward to the publication of the Schools White Paper for further clarity on how this will continue to be addressed in the future.

Overall, the local government finance settlement has delivered a fairer system based on deprivation and need. The increased continuation of the Recovery Grant and an equalised funding system are key steps toward a fairer future for our members, and we will continue to ensure that the voices of our members are heard in ensuring this journey continues.

You can read the article in The MJ here.