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Cllr Sirajul Islam welcomes £36.6m cash injection for Tower Hamlets to boost local services
Cllr Sirajul Islam, Leader of the Tower Hamlets Labour Group, has welcomed the Labour Government’s announcement that Tower Hamlets will receive a £36.6 million cash injection for essential services next year.
Under the Tories, local authorities were starved of investment, with core spending power down by around a quarter since 2010. That put immense pressure on councils up and down the country, including Tower Hamlets. But the Labour Government has announced a radical overhaul of how local government is funded, reversing Rishi Sunak’s cheap political efforts to funnel money into wealthy areas and Tory seats.
“Fair Funding” is the next step on Labour’s journey to reverse a decade and a half of austerity and decline under the Conservatives and build stronger communities.
England’s councils will get billions for essential services with more money going to places with the greatest need. Crucially for Tower Hamlets, the new “Fair Funding Allocation” will deliver £36.6 million in new government funding alone in 2026/27, correcting years of underfunding that failed to account for our borough’s high levels of deprivation and population density.
The funding injection is aimed at restoring pride and opportunity in places that have been left behind. It means councils will have more resources available to bring back libraries, youth services, clean streets, and community hubs.
The money is part of the first multi-year funding settlement in over a decade, giving councils three years of financial certainty so they can plan ahead rather than firefight year to year.
Notably, funding for Children, Families & Youth services in the borough is set to nearly triple, rising from £3.8m to over £10m.
In a turning point for local government finance, the outdated system that saw some councils build up savings while others faced collapse has been replaced. Instead, Tower Hamlets is now being funded using an evidence-based system that properly recognises our local circumstances and the true costs of providing services in our diverse communities.
Cllr Sirajul Islam, Leader of the Tower Hamlets Labour Group, said:
“After 14 years of Tory austerity, Labour is finally putting money back into our local services.
This £36.6 million cash injection for Tower Hamlets is a game-changer. It vindicates what we have said for years: that our borough was unfairly treated by the Conservatives.
While Mayor Lutfur Rahman and his Aspire, administration have wasted time on vanity projects and mismanagement, this Labour Government is delivering the serious investment we need.
This funding means more money for our high streets, our youth services, and for cleaner streets. It is now up to the Mayor to ensure this money is spent transparently and effectively to improve the lives of residents, not squandered. Tower Hamlets Labour will be watching closely to ensure every penny delivers real value for our community.”
Cllr Marc Francis, Shadow Cabinet member for Finance said:
“This massive increase in grant funding for Tower Hamlets Council is a godsend to our overstretched frontline services.
If Mayor Lutfur Rahman and his Aspire Party councillors choose this extra funding in 2026/27 and the similar increases over the next two years, will enable this authority to protect and expand services without any need to increase Council Tax in the way he has done over the past three years.
This is a demonstration of this Labour Government’s commitment to local public services and the people of Tower Hamlets.”
ENDS
Notes to Editors:
- Figures based on illustrative Core Spending Power projections for 2026-27 vs 2025-26.
- The total Core Spending Power uplift for Tower Hamlets is projected at £55.5m (+12.1%).
- The new “Fair Funding Allocation” contributes £36.6m of this increase, replacing previous legacy grants.
- Specific funding for Children, Families & Youth increase from £3.75m to £10.03m.
