Local councils grappling with the financial strain of high-cost services are set to receive a significant funding boost aimed at modernising their operations, leveraging artificial intelligence (AI), and reducing their dependency on emergency financial support. A total of £91 million has been allocated for 14 councils across England that currently benefit from Exceptional Financial Support, a programme designed to assist those under the most severe financial distress.
This funding will enable these authorities to invest in planned projects over the next two years, focusing on modernising their most intensive and costly service areas. The goal is to establish a more sustainable long-term framework and to break the cycle of reliance on exceptional funding.
Innovative Projects Underway
Among the initiatives receiving funding, Redbridge is set to implement AI-powered technology aimed at helping individuals maintain their independence for longer through home-based devices capable of detecting and preventing falls. In Stoke-on-Trent, efforts are underway to redesign frontline social work, introducing a new model centred on family preservation.
Additional councils benefitting from this support include Bradford, Brighton & Hove, Haringey, Havering, the Isle of Wight, the Isles of Scilly, Lambeth, Redcar & Cleveland, Sefton, Trafford, Waltham Forest, and West Berkshire. The funding will be distributed over two financial years, allocating £41 million for 2026-27 and £50 million for 2027-28.
Government Commitment to Reform
Jim McMahon OBE, Minister for Local Government, Devolution and Regional Growth, expressed his commitment to addressing the challenges faced by local councils. He stated that the current funding system has placed immense strain on councils, particularly in areas such as care and temporary accommodation.
McMahon emphasised the government’s proactive measures to rectify these foundational issues, which include reforming the outdated funding system and tackling homelessness, children’s services challenges, and the complexities associated with Special Educational Needs and Disabilities (SEND).
This targeted funding initiative is seen as a crucial step towards alleviating the pressures on councils, reducing their reliance on emergency funding, and establishing a framework for broader local government reform.
Tailored Solutions for Local Needs
Additional initiatives receiving financial backing include a project in West Berkshire designed to simplify access to children’s services, ensuring families can easily navigate the system for Special Educational Needs and Disabilities (SEND), Early Help, and Children’s Social Care. In Brighton & Hove, a pilot project aims to integrate the ‘reablement service’—which aids individuals in regaining skills and independence following hospital stays—more closely with NHS services, facilitating quicker transitions home.
Trafford is set to enhance its service delivery through improved technology, including AI, which will aid in creating a more cohesive and efficient system for residents. This will involve modernising their computer systems to centralise information, allowing different teams to collaborate more effectively in assisting residents.
Haringey plans to address temporary accommodation pressures by acquiring homes, thereby reducing reliance on external providers and supporting more individuals in transitioning to permanent housing. Bradford aims to optimise SEND transport services, ensuring adequate support and educational psychology resources are readily available while effectively resolving disputes.
Long-Term Vision and Sustainable Funding
The initiatives are tailored by individual councils to meet their specific needs, with the overarching aim of benefiting local authorities nationwide in the long run. Insights gleaned from these projects will inform the government on effective strategies, ensuring future funding is allocated more efficiently to the services that communities depend upon.
By modernising and streamlining high-cost services through comprehensive reform, councils will be better positioned to focus on delivering essential services that matter most to residents, such as high-quality social care and secure housing.
This announcement builds upon two years of efforts to establish a more sustainable funding model for local government in England. Recent grants—including the Recovery Grant, Children’s Social Care Prevention Grant, and the Children and Families Grant—aim to bolster local authorities and their communities.
In February, the government introduced its first multi-year Local Government Finance Settlement in a decade, adopting a fairer and more straightforward approach to distributing funding for everyday services where it is most urgently needed. This initiative accompanies significant reforms targeting high-cost services, particularly in children’s services, homelessness, and the resolution of SEND deficits through the write-off of 90% of councils’ historical debts.
Funding Allocations for Councils
As part of the funding distribution for the financial years 2026/2027 and 2027/2028, the following allocations have been confirmed:
- Bradford: £12.7 million
- Brighton and Hove: £6.4 million
- Haringey: £4.79 million
- Havering: £6.75 million
- Isle of Wight: £6 million
- Isles of Scilly: £1 million
- Lambeth: £6.6 million
- Redbridge: £7.5 million
- Redcar and Cleveland: £4.8 million
- Sefton: £6.2 million
- Stoke on Trent: £9.14 million
- Trafford: £7.5 million
- Waltham Forest: £6.14 million
- West Berkshire: £5 million
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