Geographical inequalities and sub-national funding in France
Think tank: City-REDI
Author(s): Dr Abigail Taylor
March 20, 2025
This report from UK think tank City-REDI examines how funding mechanisms can be used to better address spatial inequalities.
The aim of this review is to draw out lessons for England, and the UK more broadly, in terms of how funding mechanisms can be used to better address spatial inequalities. The review is based on desk research of academic and policy publications, as well as 11 interviews conducted with French academics and policy experts in summer-winter 2024.
The review highlights several key issues relevant to the UK and English context, including how fiscal equalisation mechanisms and local fiscal autonomy and flexibility can support national government in addressing geographical inequalities.
The report also provides insights into how the state can help local authorities with less capacity / expertise by providing support with developing funding bids. Accessing support from civil servants based regionally who have a strong understanding of regional needs can help facilitate relationship building and enable the development of stronger, more regionally responsive bids.
France illustrates how long-term local fiscal autonomy, equalisation mechanisms and flexibility are important in enabling sub-national government to develop locally specific, long-term responses. Sporadic or piecemeal levers are unlikely to create considerable impact.
Selective application of competitive funding, alongside sustained long-term allocations, can foster innovation in tackling challenges while supporting strategic planning.
There is a trade-off to be made between targeting funding at all local authorities that share certain size characteristics (e.g. small towns) and targeting those with the greatest levels of socio-economic needs. Whilst targeting all local authorities in this manner can symbolically draw attention to the challenges faced by that type of area, spreading funding thinly can limit the extent to which inequalities can be addressed, not addressing citizens’ feelings of abandonment.
