London Councils has welcomed measures for tackling homelessness announced by the Chancellor in the Budget.

The cross-party group says the £233 million of extra funding to prevent homelessness will help sustain local services in the face of record pressures. Additional investment in SEND and social care was also welcomed, alongside the extension of the Household Support Fund for a further year and measures to boost housebuilding.

In the run up to the Budget, boroughs highlighted the severe budget pressures they face, with several at risk of effective bankruptcy. Boroughs in London have seen a 28% real terms reduction in funding per Londoner since 2010, with increased demand and rising costs creating a perfect storm for borough finances.

London Councils had previously forecast a funding gap in the capital of £700m next year. While the measures in the Budget will help to address some of the immediate pressures facing local authorities, a sizeable shortfall is expected to remain in place.

Cllr Claire Holland, Chair of London Councils, said: “We went into this Budget warning of a homelessness emergency that is devastating Londoners’ lives and pushing boroughs to the brink of bankruptcy.

“The measures announced by the Chancellor to support local homelessness services and boost housing growth are hugely welcome, alongside the additional investment in SEND and social care.

“While the Budget will help to address some of the immediate pressures we face, the outlook for borough finances remains extremely tough after 14 years of structural underfunding. We will continue working with ministers to address the significant financial challenges we face in local government and maintain vital local services.

“Next year’s Comprehensive Spending Review will be a crucial opportunity to ensure London boroughs have the resources we need to be an effective partner to national government over the coming years and help to drive growth across the capital.”

Boroughs will have a clearer picture of the financial challenges they face for 2025/26 once the distribution of the additional grant funding announced is confirmed and the Local Government Finance Settlement is published in December.

Other key measures announced in the Budget relevant to London boroughs include:

A £1 billion funding uplift to reform the system for school pupils with special educational needs and disabilities.
£600m in additional grant funding for social care.
More certainty on social rent levels, with rents to rise by CPI +1% for five years.
£500m additional investment in the Affordable Homes Programme to boost housebuilding.
Reforms to the Right to Buy scheme to allow councils to retain 100% of receipts to invest in building new council homes.