UK Shared Prosperity Fund allocations announced for 2025/26
Network for Europe’s Andy Churchill breaks down the detail of the recently published guidance for the one year UK Shared Prosperity programme for 2025/26.
Last week the UK government has announced the allocations for the UK Shared Prosperity Fund (UKSPF) for 2025/26. This funding aims to support activities from April 2025 to March 2026, including continuation of existing UKSPF activity where appropriate, with an intention on transitioning to a future funding framework.
The Ministry of Housing, Communities and Local Government (MHCLG) remains responsible for overseeing the fund, which will be distributed across all areas of the UK. Notably, the new allocations take relative deprivation into account, moving away from the previous population-based formulas, an approach which is more reminiscent of previous European funding calculations, which will be welcomed by many.
| Area | Allocation for 2025/26 |
Three-year funding (2022-2025) |
|---|---|---|
| Greater Manchester | £43.2m | £98.2m |
| Liverpool City Region | £25.6m | £52.7m |
| Lancashire | £21.7m | £62.2m |
| Cheshire & Warrington | £9.5m | £33.1m |
| Cumbria | £6.1m | £21.2m |
| North West | £106.3m | £267.5m |
| England | £570.8m | £1.5bn |
| Total UK | £902m | £2.6bn |
Key highlights:
Funding focus: The UKSPF will support initiatives under the same three main headings: Local People, Local Places, and Local Enterprise. Funded activity must align with the government’s five missions: Economic Growth, Clean Energy, Safe Streets, Removing Barriers to Opportunity, and Health.
Local decision-making: The approach for 25/26 funding is significantly more light-touch with a delegated delivery model designed to empower local decision making and the allocation of funds based on local needs without the requirement for revised investment plans for 2025/26.
Increased capital funding: There is a higher percentage of capital funding for each area in comparison with the previous UKSPF programme, with a large portion of this earmarked for “Local Growth Plans and local priority investments”.
Multiply: No national funding for Multiply meaning there is more funding available locally. Multiply is no longer a separate category but adult basic maths can be included within other strands.
Devolution and local authorities
VCFSE collaboration with Strategic and Combined Authorities will be essential for the successful delivery of UKSPF projects. The recently published English Devolution White Paper highlights the governments ambitions for shifting power into communities that will have a significant impact across the North West with opportunities for the VCFSE sector to be a part of devolution.
In the North West, Greater Manchester and Liverpool City Region, both with established Mayoral Combined Authorities, continue to benefit from the deepening devolution of funds and powers from Central Government. A Combined County Authority is being developed in Lancashire, with the first initial meeting in the new year, receiving an initial £20 million in devolution funding. Discussions are also ongoing in Cumbria and Cheshire and Warrington towards further devolution.
Employment reforms
The 25/26 UKSPF programme will need to link to the recent “Get Britain Working” White Paper in which the government outlined its plans to transform the Department for Welfare into a Department for Work. This includes merging Jobcentre Plus and Careers Service into a new jobs and skills service, focusing on people's skills and careers and mobilising Mayors to provide joined up services to support local need.
Greater Manchester and Liverpool City Region will receive funding for Trailblazers to set the blueprint for this new approach, with the latter focusing on delivering the Youth Guarantee, ensuring every young person has a chance to earn or learn.
Next steps
While the announcements and allocations appear positive, we strongly encourage our infrastructure organisations and partnerships to connect with their lead authority to advocate for the VCFSE sector’s role in UKSPF delivery. Lead authorities will be reviewing the recently released guidance to understand how this will shape delivery for next year so now is the time to ensure the sector is involved in planning for delivery.
VSNW will endeavour to support our infrastructure partnerships to advocate for the sector across the North West in developing UKSPF programmes (including its successor) that builds on the expertise and experience of the VCFSE.
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Network for Europe represents the VCFSE sector in the North West and has led the sectors engagement with European Union funding throughout the last few decades and engages with the third sector across Europe to share ideas and best practice. Andy has significant knowledge of VCFSE funding and has been instrumental in advocating for the important role of the VCFSE sector to the economy.
