British finance minister John Healey will use next week’s UK budget to give mayors across England new funding and greater control over local spending, according to reporting by Reuters on 24 October 2026. The package centres on a new borrowing facility, seed funding for locally chosen growth projects, and additional money to strengthen the teams that will manage larger regional budgets.
The measures are presented as a significant step in the government’s devolution agenda, under which economic decisions now taken in Westminster would increasingly be made closer to the communities they affect. For mayors and strategic authorities, the changes would mean less dependence on case-by-case approval from central government and more scope to plan investment over a longer horizon.
What the package includes
The largest element is a £1.5 billion borrowing facility that will be designed in conjunction with mayors. According to the reporting, it is intended to give local leaders access to capital that can be used to support growth projects in their areas. Rather than being imposed as a single centrally designed instrument, the facility is expected to reflect the practical needs identified by the mayoral authorities that will use it.
Alongside the borrowing facility, £285 million of seed funding will be made available next year through a new scheme called “Good Growth”. Under the scheme, local leaders will be able to direct money toward their own priorities without first seeking permission from Whitehall. The funding is aimed at reducing the current reliance on a patchwork of separate bidding rounds, in which councils and combined authorities compete for relatively small pots of money controlled by different departments.
The third element is a further £150 million next year for strategic authorities to build staffing capacity and professional expertise. As regional bodies take on responsibility for larger budgets, officials say they will need stronger teams in areas such as project appraisal, procurement, financial management and delivery. The additional funding is intended to help authorities recruit and develop that capability before the new powers are fully in use.
Taken together, the three measures amount to a package that combines money, borrowing capacity and institutional support. The borrowing facility addresses the ability to finance larger projects, the Good Growth funding provides early money that can be deployed quickly, and the capacity funding addresses the question of whether local institutions are equipped to manage the expanded role.
Officials have indicated that the money could be used across a broad range of local priorities. Housing is one area highlighted in the reporting, alongside the regeneration of high streets and improvements to transport links. Those three themes reflect long-standing concerns in many English towns and cities, where housing supply, the future of town centres and connectivity are closely linked to wider economic performance.
The emphasis on local choice is central to how the package has been framed. Instead of central government setting detailed conditions for each project, mayors would be expected to identify where investment would have the greatest effect in their region and to account for the results. Supporters of the approach argue that local leaders are better placed to understand the specific constraints holding back growth in their areas, whether those relate to land, infrastructure, skills or commercial space.
A shift away from Westminster
Prime Minister Andy Burnham was quoted by Reuters in connection with the announcement, saying: “I’m calling time on local leaders going cap in hand to Westminster. That is no way to run a country.”
The comment captures the political argument behind the package. For years, critics of the centralised system have argued that requiring local leaders to bid repeatedly for funding creates delay, uncertainty and administrative cost. Each bidding round can involve detailed applications, tight deadlines and criteria set nationally, even when the underlying project is essentially local in nature.
Under the new approach, the Good Growth funding is designed to break with that pattern. By providing a single stream of money that local leaders can allocate according to their own plans, the government aims to reduce the time spent preparing bids and to give authorities greater certainty about what they can spend and when. That certainty, in turn, is intended to make it easier to sequence projects, attract private investment and coordinate spending across housing, transport and regeneration.
The announcement also fits within a broader devolution push that has gradually expanded the role of mayors and combined authorities in England over recent years. Regional leaders already exercise powers in areas such as transport and skills in some parts of the country, and further transfers of responsibility have been debated as a way of narrowing regional economic differences. The budget package extends that direction into finance, giving local government not only more responsibilities but also more tools with which to meet them.
Economists and local government specialists often note that devolution involves a trade-off. Greater local autonomy can allow policies to be tailored to regional conditions, but it also places a premium on accountability, transparency and delivery capacity. The inclusion of £150 million for staffing and expertise suggests that the government is aware of that challenge and intends to invest in the institutions that will carry the new responsibilities.
For now, the headline figures provide a sense of scale. At the exchange rate cited by Reuters, $1 = 0.7478 pounds, the £1.5 billion borrowing facility is equivalent to about $2 billion. The seed funding and capacity funding, while smaller in absolute terms, are intended to be available next year, giving authorities a relatively near-term starting point.
What happens next
The full details are expected to be set out when Healey presents next week’s budget. At that point, mayors and strategic authorities will be able to see the structure of the borrowing facility, the allocation and conditions for Good Growth funding, and the timetable for the capacity support.
In the meantime, the announcement signals a clear direction of travel. Economic decision-making in England is set to move further from Westminster toward regional leadership, with local authorities given more money, more borrowing power and more responsibility for outcomes. Whether that shift delivers faster housing, stronger high streets and better transport links will depend on how the new system is designed, funded and delivered in practice.
For local leaders, the immediate task will be to prepare investment plans that can make use of the new funding when it becomes available. For central government, the challenge will be to provide a framework that offers genuine autonomy while maintaining proper oversight of public money. The budget will be the first test of how that balance is struck.
