London councils to lose millions in funding despite high poverty levels

The communities secretary, Angela Rayner, promised last year that a new funding model would be ‘fairer’. Photograph: Hannah McKay/Reuters

Ministers face a backlash from Labour-run town halls after it emerged deprived inner-city London councils stand to lose millions of pounds under a proposed funding shake-up despite promises to redistribute cash away from wealthy areas.

Central London councils with high levels of poverty and homelessness, including Camden, which includes Keir Starmer’s parliamentary seat, could lose more than 10% of their funding under the proposals, according to the Institute for Fiscal Studies (IFS).