Labour to shift council funding to poorer areas
Summary
The UK government is planning to change how it allocates funding to local councils in England. This new system aims to give more money to areas with higher poverty levels by updating the funding formulas for the first time in a decade, starting from 2026. Some rural councils express concern that they might receive less funding under these changes.Key Facts
- The new funding plan will give more money to councils in poorer areas by changing how funds are allocated.
- This change updates a system that has been in place since 2013.
- The new system will reduce the number of funding formulas by over one-third.
- The changes will not affect local revenue from council tax, which is capped at a 5% annual increase unless otherwise approved.
- There is concern from rural councils about losing hundreds of millions of pounds.
- The plan will begin in 2026 and phase in over three years.
- The Institute for Fiscal Studies believes the changes will significantly shift funding towards urban areas in the North and Midlands of England.
- Exact impacts on individual councils are not yet clear, with more details expected after a consultation process in the autumn.
Read the Full Article
This is a fact-based summary from The Actual News. Click below to read the complete story directly from the original source.
