Four London councils submit revised funding proposals to the Treasury

Wandsworth proposes 94% council tax rise and says reforms require service cuts

Four London council leaders formally challenged government reforms on Thursday by delivering revised funding proposals to the Treasury and asking the government to reconsider its overhaul of local-authority funding rules. The councils — Wandsworth, Richmond, Westminster and Kensington and Chelsea — said the changes, known as Fair Funding Review 2.0, would reduce their central funding by 40% to 58% by 2029. The proposals were submitted under the Sustainable Communities Act. The councils’ leaders collectively warned that services would be hit because of the funding cuts.

The government said the existing local-authority funding model was outdated and that the reforms were intended to direct money where it was most needed. Fair Funding Review 2.0 aims to shift more cash toward areas with higher deprivation.

The councils said the reductions would vary by authority. Kensington and Chelsea is set to lose £108m, or more than 40% of its central funding, over the next four years under the reforms. Westminster is due to see its resources drop by around £100m, or 46%, while Richmond is set to lose £26m, or 58% of its core funding.

Separate from the October 22 funding submission, an unnamed group warned that London councils faced a £5bn funding gap by 2030. A September 22 report said Westminster council planned 520 job cuts in a savings plan. Another item, published two days before the main report, recorded mixed council verdicts on the new ‘fair funding’ plan.

In an earlier BBC News item published on January 26, Lib Dem Richmond council leader Gareth Roberts said the cuts risked “pushing this council towards a financial cliff edge”. He said: “We will not stand by while Whitehall forces our residents to pay the price for a deeply flawed formula.”

Wandsworth’s Conservative administration said the reforms would cut its funding by 40% and force it to slash services and raise council tax. The authority proposed raising council tax by 94% from April, in addition to making sweeping cuts.

Those measures include shutting Wandsworth’s cost-of-living reserve with £6.2m of unspent funds, replacing Labour’s Access for All with a much smaller concessionary scheme, cancelling its Borough of Sanctuary status and suspending voluntary sector grants for four years.

Wandsworth Council leader Robert Morritt, who heads a Conservative minority administration, said: “Residents should not have to pick up the bill for changes imposed by Whitehall. This proposal takes our case directly to government. We are using every route available to fight for a fairer deal and protect Wandsworth taxpayers.”

Tory Kensington and Chelsea council leader Elizabeth Campbell said: “I will use every tool at my disposal to fight these cuts, stand up for our residents and secure the fair deal our borough deserves.”

A Ministry of Housing, Communities and Local Government spokesperson previously said: “We have consulted extensively on reforming the outdated council funding system to ensure money goes where it is most needed, following on from a longstanding consensus. We’re also protecting councils through transitional arrangements so no area faces a cliff edge.”