The Local Government Association said the Prime Minister's proposals to allow councils to keep all of the cash brought in by business rates from fracking schemes was "a step in the right direction".
A spokesman for the councils' group said:
Councils have been clear that the people and communities whose areas host fracking sites must feel the benefit.
Today's announcement from the Prime Minister is a step in the right direction, which will mean that business rates paid by shale gas firms will help councils to maintain and improve local services for residents.
While it is encouraging that government is listening, local areas will be keen to hear more details on how the community benefits package will be strengthened to fairly renumerate those who will be most affected.
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Lord Geoffrey Howe is known by many for his resignation speech which was seen as the catalyst which destroyed Margaret Thatcher.