Struggling councils get £150m exceptional funding

Councils in the South East will receive millions of pounds in support to help them balance their books amid financial struggles.

More than £150m in Exceptional Funding Support (EFS) has been agreed in principle by the government to help East Sussex, Brighton & Hove, Medway, Woking and Worthing councils.

The agreements allow councils to use capital funding usually reserved for longer-term projects to instead cover day-to-day costs, giving them short-term financial flexibility.

The funding was needed for a variety of reasons, including ageing populations, emergency accommodation and tackling homelessness, spokespeople for the councils said.

East Sussex County Council is to receive £70m in support in the next financial year.

A spokesperson said the funds were essential for the council to set a balanced budget, but the funding will be "raised through borrowing".

The council also said it had made £160m in service cuts since 2010 but added: "The actions taken to date are not enough because more people than ever need our services and the costs of providing them have risen sharply.

"The help in the short term will increase repayments in years ahead and therefore increase the financial pressure on the council and local taxpayers."

Under the plans, announced by the Ministry of Housing, Communities and Local Government, Woking will receive £58.1m in support, while Brighton & Hove will get £15m, Medway £10.1m and Worthing £5m.

Medway and Worthing councils also agreed to increase the support it will receive in the current financial year, rising to £28.4m and £4.75m respectively.

In a letter to Woking Borough Council, local government minister Alison McGovern said the government agreed with the council that "there is no reasonable means by which the council can meet all its debt liabilities from its own resources".

As of April 2025, the council owed £2.16bn and was found to have the highest amount of local government debt per person in the UK.

Woking Borough Council leader Ann-Marie Barker said: "This is another important step in our long‑term recovery, giving us the financial certainty we need to reduce the council's debt and put Woking on a more sustainable footing."

The authority also said it would be borrowing to cover the £5m funding, which it said was needed due to a "continuing surge of local people becoming homeless".

A council spokesperson added that it expected to spend as much as 30% of its budget on helping people who would otherwise be homeless.

Brighton & Hove City Council said the funding would help manage the "unprecedented financial pressures we face".

The funding would be focused on addressing emergency and temporary accommodation costs, it added.

Papers from Medway Council, which is to set its annual budget on Wednesday, said it had requested flexibility to increase council tax at about the 5% limit at which a referendum would usually be required.

In a statement on the funding, McGovern said: "The support we're announcing is critical for the councils, and we are doing everything we can to ensure councils can balance the books, including by making £78bn available through the first multi-year settlement in a decade."

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