Peterborough is set to receive a permanent major increase in council funding of almost £100 million following the Labour Government’s Fair Funding Review of council finances – an increase secured after sustained campaigning by local MPs and the Labour-led council.
The settlement, announced today by the Labour government, reforms outdated funding formulas and directs more support to areas with higher levels of deprivation and demand for services, including a funding uplift for Cambridgeshire authorities. This marks a decisive break from the short-term, unfair system that left cities like Peterborough underfunded for years.
For Peterborough, council funding is now set to be £94.9m higher every single year by 2028 than it was in 2025 – an increase of 42%. This compares to a shocking increase of just 3% (£3.5m) under the Conservatives from 2015/16 to 2019/20.
In neighbouring Cambridgeshire, funding will rise by £166.2m over the same period – a 29% increase – compared to a rise of just £20.5m, or 6%, from 2015/16 to 2019/20.
North West Cambridgeshire MP Sam Carling, Peterborough MP Andrew Pakes and Peterborough City Council Leader Cllr Shabina Qayyum have worked jointly to press the government for a permanent funding settlement that reflects Peterborough’s needs, while also making the case for fairer treatment for communities across Cambridgeshire.
The increased funding works out at £407 extra per Peterborough resident, every single year – and will be spent on better maintenance of local roads and green spaces, more effective support for people in poverty, social care and other services to support older residents, and much more.
Sam Carling MP, Member of Parliament for North West Cambridgeshire, said:
“This is exactly what we have been campaigning for – a permanent, fair funding settlement that finally recognises Peterborough’s needs, alongside fairer support for communities across Cambridgeshire.
For years, our area was short-changed by outdated formulas and a system that took money out of places like ours. This Labour government is putting that right.
This is the power of Labour MPs working hand in hand with a Labour council – securing long-term investment, not sticking plasters, and setting our area up for success.”
Andrew Pakes MP, Member of Parliament for Peterborough, said:
“Peterborough has been held back for too long by a broken funding system that simply didn’t reflect the reality on the ground.
This announcement shows that Labour is serious about backing our city and ending the unfairness that left communities struggling while others pulled ahead.
It’s a turning point – and it shows what can be achieved when we speak with one voice for Peterborough.”
Cllr Shabina Qayyum, Leader of Peterborough City Council, said:
“This is a hugely important moment for Peterborough.
Our council has worked incredibly hard to stabilise finances after years of cuts, but fair funding has always been essential to securing our city’s future.
This settlement gives us the certainty we need to plan ahead, protect vital services, and invest in the things that matter most to residents – while also recognising the pressures faced by councils across Cambridgeshire.”
The Labour government’s reforms introduce the first multi-year settlement in a decade, simplify dozens of funding streams, and target resources towards areas with the greatest need – providing councils like Peterborough, and authorities across Cambridgeshire, with the stability to plan, invest and deliver for residents.