Developing local solutions to complex issues
Be it building new homes, unlocking economic growth or improving the health and life chances of the most vulnerable in our society, we know that councils are the key to solving our biggest local and national challenges.
That’s why I and all five of the LGA’s political group leaders have written to Chancellor Rachel Reeves ahead of November’s Budget, highlighting the support and value that councils provide locally – and nationally.
From Cumberland to Cambridge and Devon to Darlington, councillors and officers are working every day to strengthen and grow their communities.
From Bath and North East Somerset Council unlocking the development of 950 homes on a riverside brownfield site, to Folkestone and Hythe District Council working to deliver an 8,500-dwelling garden town, councils are crucial to the delivery of new housing and economic growth.
Councils are also turbocharging public services using new digital technologies, such as Wigan Council’s adoption of artificial intelligence (AI) in its care service to equip staff to provide more patient-centred care.
Alongside driving local growth and service innovation, councils work tirelessly to develop local solutions to complex issues that are priorities not only for local communities, but also for central government.
By tackling challenges such as meeting growing demand for support for children with special educational needs and disabilities (SEND), sourcing desperately needed temporary accommodation, or working to develop sustainable asylum accommodation and support systems, councils are at the forefront of efforts to address key national policy issues.
Ultimately, empowered and financially sustainable councils hold the key to both addressing the needs of their local communities and enabling government to tackle challenging areas of policy reform.
In particular, as locally rooted bodies with a democratic mandate, councils have local legitimacy and are best able to work with residents and across public services to find ways to meet communities’ needs, drive change and improve services.
We recognise and welcome the reset relationship and new way of working between central and local government, as demonstrated by the introduction of the Leaders’ Council (see ‘Taking the lead’).
But there is more to do, and in the LGA’s Budget submission, we urge the Chancellor to invest in and support councils to allow them to deliver to their full potential, both to support local communities and to address national priorities.
We set out actions and proposals that, if taken on board by government, would help councils to contribute even further to key national objectives, such as supporting children and young people, and kick-starting economic growth (see below), as well as public sector reform.
However, while councils have huge potential to support government in delivering its objectives, we cannot shy away from the scale of the financial challenges the sector currently faces.
If councils are to deliver to their full capacity, for both local communities and national objectives, ministers must take further action to address the sector’s financial issues.
The LGA’s Budget proposals
Council finances
- Provide a significant increase in overall funding to avoid financial failure and ensure councils can meet demand for services.
- As part of the proposed Fair Funding Review 2.0 reforms, provide effective transitional protection to shield councils from both cash and real-terms cuts.
- Undertake a cross-party review of options to further improve the funding system, including a review of council tax and business rates retention.
- Write off dedicated school grant deficits as part of SEND reforms.
- Ensure new unitary authorities are financially sustainable and fund the costs of local government reorganisation.
Children and young people
- Ensure that all councils receive sufficient funding to invest long term in family help, child protection, child in care and care leaver services.
- Develop a cross-government strategy for children, young people and families, to ensure that all partners are working towards a shared ambition.
- As part of forthcoming SEND reforms, ensure councils have adequate powers to improve local SEND systems and hold partners to account.
- Ensure that funding for the Best Start Family Service can be used flexibly, and join up different funding streams to enable councils to act strategically.
- Give councils the powers and resources to manage the early education and childcare market.
- Ensure the upcoming youth strategy brings together different government initiatives for young people in a holistic fashion.
Health and social care
- Provide an immediate injection of funding to stabilise the adult social care system.
- Commit to funding fully the outcomes of the adult social care fair pay agreement.
- Provide local government with the necessary involvement in the Adult Social Care Negotiating Body, to ensure councils’ statutory duties can be properly executed.
- Invest in adult social care prevention trailblazers and independent evaluations of existing social care interventions.
- Provide greater investment in tech-enabled care, particularly to support the less well-off.
- Invest in AI for system efficiency, prevention and customer service.
- Ensure that resources flow towards the community and prevention, in accordance with the vision in the 10 Year Health Plan for England.
Housing
- Uprate local housing allowance (LHA) rates to the 30th percentile of local rents beyond 2025/26, and temporary accommodation reimbursement rules to 90 per cent of prevailing LHA rates.
- Give local authorities access to the £2.5 billion of low-interest loans for social housing providers announced at the Spending Review 2025.
- Continue to invest in the One Public Estate programme, Brownfield Land Release Fund and the Local Authority Housing Fund, and commit multi-year funding to the Council Housebuilding Support Service.
- Ensure all new burdens placed on local authority HRAs (including decent homes and energy efficiency standards) are fully assessed and funded.
- Implement rent convergence from April 2026 at a minimum of £2 per week.
Economic growth
- Councils, working in partnership with their mayoral strategic authorities (MSA) where they exist, need to be sufficiently resourced to deliver effectively.
- Enable all local authorities to play a role in government growth policy, including those not currently in an MSA.
- Find a replacement for the Rural England Prosperity Fund.
- Provide further clarity on local growth funding, including local growth funds and services currently funded by the Shared Prosperity Fund.
- Provide multi-year settlements for highways capital funding and invest in programmes that help councils use AI to plan repairs.
Skills and employment
- Develop a co-design strategy to make individual Get Britain Working reforms work for local people and places.
- Evolve Local Get Britain Working Plans to become funded outcome agreements between national and local government.
- Pilot ways to bring together the job support offer locally, so Pathways to Work, the reform of jobcentres and local government’s Connect to Work join up.
- Broaden the Youth Guarantee for 18 to 21-year-olds to include 16 to 24-year-olds.
- Replace the UK Shared Prosperity Fund, ending in March 2026, with a Local Labour Market Fund combining support for local employability, skills and health initiatives.
Local climate action
- In principle, local authorities need statutory backing, sufficient funding and robust support to lead on climate action. Over the coming months, the LGA will develop clear proposals for government on next steps.
- Provide clarity and certainty on the longer-term role of local government, including strategic authorities, in the delivery of the Warm Homes Plan.
- Simplify and devolve Warm Homes funding to local areas to allow councils to develop schemes linked to local skills, growth and housing strategies.
Safer streets and communities
- Provide a single, sustainable, multi-year funding stream for community safety partnerships (CSPs) and community safety services, paid directly to councils or CSPs.
- Reform the duty and partnership landscape so CSPs have the powers, partners and mandate to deliver outcomes.
- This is an edited version of the LGA’s Budget submission. Read it in full on the LGA website.