The funding for 2015/16 is designed to enable local services to offer intensive help to 400,000 families who are currently below the threshold for support through the existing Troubled Families scheme.
Danny Alexander, the chief secretary to the Treasury, said: “The Troubled Families programme is a radical example of how, by spending a bit more in certain areas, we can save much more in others and by doing so create a stronger economy and a fairer society.
“Extending this intensive help to 400,000 more families will enable us to tackle problems such as truancy, antisocial behaviour and crime.”
The money will be offered to local services on a payment-by-results basis with central government covering 40 per cent of the cost of working with each family.
Councils and other local agencies will foot the remaining 60 per cent of the bill.
The Department for Communities and Local Government will administer the funding and local agencies will need to produce a “detailed plan” setting out how they will work together and reform services to reduce spending to get the money.
The Treasury said that the programme saves public services money by helping families into work, improving school attendance, and reducing antisocial behaviour and criminality.
The Local Government Association (LGA) said the announcement was "a vote of confidence" in the work councils had done through the existing Troubled Families programme but raised concerns about the funding arrangements.
"Further cuts to local government funding will make it increasingly hard to provide the key services that troubled families will need to access to tackle the challenges they face," said Merrick Cockell, chairman of the LGA.
"We will be seeking clarification that this £200m is actually additional money and not money redirected from existing local authority budgets. We await the Spending Round announcement on Wednesday for more detail on this."
The current Troubled Families programme has worked with more than 35,000 families to date and ends in 2015.
