“This is a once-in-a-generation opportunity to put right the funding inequalities our communities have faced for too long”
Posted on November 17, 2025
As the Fair Funding Review nears its final stages, our Chair, Cllr Sir Stephen Houghton, wrote in the Yorkshire Post about why the Government must commit to our asks to offset the detrimental impact of adding housing costs to the Index of Multiple Deprivation (IMD):
“We welcome the Government’s commitment to reform. We welcome the promise of a fairer formula that would reflect genuine need. But the inclusion of housing costs as a deprivation indicator threatens to undermine the principles of the review and means that the Government must make other changes to ensure that funding is directed to places that most need it…
Despite this, we remain committed to working constructively with the Government and commend the work of the new Minister Alison McGovern, who attended our recent reception in Parliament and listened to the key proposals that would support our members …
The Government must commit to 100 per cent Council Tax Equalisation. This takes into account an area’s Council Tax base (how much can be raised) when allocating grant funding.
This would ensure that grant funding is fairly redistributed to areas with the lowest ability to raise revenue locally, helping the most deprived communities. It must also introduce a new Children’s Services Formula that recognises the complex and deprivation-linked drivers of demand in children’s social care, such as overcrowding, poor health, and low educational attainment.
We are also pushing for the removal of the ‘Remoteness Adjustment’ for our members. This has been included on the basis of a weak ‘theoretical case’ that councils in more rural and remote areas face higher costs to deliver services. While we recognise that rural councils face unique challenges, so do densely populated areas, and the current proposal lacks a strong evidence base and risks diverting funding away from urban areas with deep and entrenched deprivation. If removed, this adjustment could provide SIGOMA councils with up to £300m.
Finally, we are campaigning hard to ensure that the Recovery Grant continues to be distributed on its current basis: deprived areas that struggle to raise money from Council Tax.
The £600m Recovery Grant, introduced in 2025-26, has been a lifeline for many of our councils across Yorkshire, targeting resources where they are needed most. Local authorities across the region received more than £100m from the Recovery Grant but would receive just half of this if it was merged into the general settlement.
This is a once-in-a-generation opportunity to put right the funding inequalities our communities have faced for too long. But it must be done properly. It must be done fairly. And it must not be undermined by last-minute changes that favour the already wealthy at the expense of those most in need.”
You can read the full article in the Yorkshire Post here.