Just 2% of councils think Labour funding plan for struggling households is enough
A shocking new survey has found that just two per cent of councils in England believe the government’s new funding commitment to help struggling households will be enough to meet rapidly growing need.
Labor has pledged to give local authorities £1bn a year for at least three years through its new Crisis and Resilience Fund. This will replace the Household Support Fund, which councils use to support low-income households, and the Discretionary Housing Payments, which are one-off grants to help with housing costs.
Councils in England have been allocated £842 million for next year through the new fund; This is higher than the £835 million provided in 2025/26 through the two schemes it will replace. Although this is a nominal increase of £7 million, it will mean a real-term cut of £34.2 million based on the September inflation rate.
According to a survey by the Local Government Association (LGA), the majority of local authorities (98%) are not confident that this funding will meet local needs to a large extent. Two-thirds also say they have seen household financial distress increase in the past year and expect that trend to continue.
Announcing the Crisis and Resilience Fund earlier this year, the government said the long-term funding approach was being introduced to enable local authorities to provide preventative support and deliver on its manifesto commitment to end mass reliance on emergency food parcels.
Prior to this, the continuation and final financing of the Household Support Fund was approved annually. But the LGA’s survey of 113 councils found only 15 per cent were confident the new fund would be ready to roll out by April.
LGA’s Health and Welfare Committee chairman, Major Dr. Wendy Taylor said: “Financial security and wellbeing are closely linked to the overall health and wellbeing and life expectancy of individuals and families, so reducing financial hardship can have a direct impact on reducing existing health inequalities across the country.
“We are pleased that the government is continuing funding for local wellbeing support through the new CRF, bringing together existing HSF and DHP programmes, but it is important that the best of these programs are retained, particularly their role in supporting long-term financial resilience.
“It will be difficult to organize the funds together because they are currently managed by different levels of local government with different rules and purposes. Local councils are prepared to work closely with the DWP and MHCLG as they develop and implement the new approach.”
The results come as growing research shows living standards continue to fall in the UK and local councils are struggling to fund basic needs. A recent report by the Resolution Foundation found that families in Britain are now £20,000 worse off than they were 20 years ago due to decades of stagnant growth.
Meanwhile, the cost of providing temporary accommodation rose to £2.8bn for councils last year as many grappled with a housing crisis that continues to push more people into homelessness.
A Government spokesman said: “We are determined to prevent households falling into crisis, which is why we are providing record funding to local councils through the Crisis and Resilience Fund and supporting the people who need it most.
“We are working closely with Local Authorities on our proposal, which will provide them with much-needed certainty and clarity to plan strategically, coordinate services and develop infrastructure that meets local needs.
