Vital funding used to boost inclusive economic growth should be extended by a year to avoid a cliff edge in support for local projects, the LGA has urged.
The UK Shared Prosperity Fund (UKSPF), which was established as a replacement for EU regional funding, is due to run out in March 2025.
The LGA says the fast-approaching deadline is starting to impact on delivery of valued locally led schemes, including on regenerating high streets, skills training, and creating jobs.
In its submission to the Treasury, the LGA says the upcoming Budget should be used to provide fully flexible one-year additional funding, equal to the third and final year of the current UKSPF.
Councils are also awaiting clarification on other growth funds, including the third round of the Levelling Up Fund.
It comes as a new report commissioned by the LGA says the current funding system for economic development is too short-term, fragmented and costly.
Longer term, the report says there should be a simplified approach to growth funding that gives local leaders greater flexibility over where and how investment decisions are made locally.
Cllr Martin Tett, Chairman of the LGA’s People and Places Board, said: “The Government should use the upcoming Budget to provide stability and certainty to councils and local businesses, who want to invest in communities, by providing an extra year of fully flexible, additional funding for UKSPF.
“This should be part of a wider review of local growth funding that means councils have the powers, resources and long-term funding to tackle regional inequalities, promote regeneration and boost economic development.”
