"The recovery is not over"

Posted on November 28, 2025

Writing in The MJ, our Chair, Cllr Sir Stephen Houghton, responds to the government’s Fair Funding policy statement. 

Our Chair discusses the crucial importance of the Recovery Grant, echoing the government’s assertion that "the recovery is not over" for the most deprived communities, areas that were hit the hardest by austerity.

'The government’s Fair Funding Review is a vital opportunity to correct historic imbalances in council funding, and we are pleased that the government has committed to many of the long-awaited reforms that SIGOMA has campaigned for over the last decade.

For too long, deprived urban communities faced the brunt of austerity, with real-terms cuts far deeper than those faced by more prosperous areas. SIGOMA councils alone have faced funding reductions 25 per cent worse than the national average, and four times worse than shire counties. These cuts have hollowed out local services and left communities struggling to access the support they need.

The government’s decision to continue the Recovery Grant is a direct response to this injustice: by continuing to allocate this funding to the most deprived areas with the weakest ability to raise council tax, the government is acknowledging the disproportionate impact of austerity and providing a vital tool to rebuild services and restore fairness.

The £600 million Recovery Grant, introduced in 2025-26, has been a lifeline for many of our councils, targeting resources to where they are needed most. In Barnsley, that investment is visible through initiatives like the “Love Where You Live” programme, a scheme that funds environmental clean-ups, park improvements, and community cohesion projects. From tackling graffiti and litter to creating inclusive events and upgrading green spaces, this shows how the Recovery Grant has translated into real, tangible improvements that restore pride and strengthen communities.

As the government rightly says, ‘the recovery is not over’: the devastating impact of austerity cannot simply be reversed by a one-off grant. The continuation of this vital funding, along with the introduction of the Recovery Grant Guarantee, will mean that councils can continue to rebuild.

 The reaffirmed commitment to 100% council tax equalisation is a vital step towards a fairer and more balanced funding system for councils across the country. This fully accounts for an area’s council tax base (how much can be raised) when allocating grant funding.  This will ensure that grant funding is now fairly redistributed to areas with the lowest ability to raise revenue locally, helping the most deprived communities: the areas who need it the most.

We are also pleased that the government has listened to the evidence regarding the reduction of the ‘Remoteness Adjustment’. This means that the unique challenges faced by both urban and rural areas will now be more fairly accounted for.

This week’s announcement in the Budget that the government will fully fund Special Educational Needs and Disabilities (SEND) once the Statutory Override ends is extremely welcome. Soaring costs and demand mean that SEND funding is one of the biggest pressures on already strained council budgets. With looming deficits still threatening council stability, we hope that the Local Government Finance Settlement will set out a prompt, sustainable plan that addresses this burden.

Overall, the government’s local government finance reforms appear to be a positive step forward on the path to a fairer future for councils. This is underpinned by the inclusion of SIGOMA’s asks, such as council tax equalisation, funding based on deprivation, and the full retention of the crucial Recovery Grant. However, much will depend on how these changes are implemented in practice. We will wait for the final settlement for the details to be confirmed, and hope that our long-championed proposals will be delivered.' 

You can read the article in The MJ here.