The government is poised to give a manifesto commitment to halt ring-fencing in local government services.
After lengthy discussions at Labour's national policy forum, a lobby led by Local Government Association Labour group leader Sir Jeremy Beecham won a concession that ring-fencing would not be extended to children's or other whole services.
Councils would also play an important role in ensuring that education funding is effectively used, as set out in this month's Audit Commission report ( LGC, 23 July).
However, there are already suggestions ministers could renege on the commitment not to extend ring-fencing.
'Ministers in the future may feel they want more influence in how the money is spent,' Sir Jeremy said.
Delegates also supported a review of education funding distribution to schools, which ought to consider whether all councils should use their funding formulae to provide extra support to schools with high numbers of underperforming pupils.
A significant minority of delegates also supported an amendment to ensure tenants are not financially disadvantaged if they choose to retain council control over the management of their homes.
The proposal will now go to a vote at the party conference in September.
On schools, delegates supported the end of selection by ability in order to reduce social division.
The collaboration between specialist schools should be accelerated to break down the academic vocational divide and drive up standards in all schools, said delegates.