The Guardian
· collected 2026-10-03 · by Rajeev Syal Home affairs editor
Hammersmith and Fulham council, a Labour-led authority in west London, has warned that it may need to raise council tax by up to 150% to maintain current services due to significant cuts in government funding under a new "fair funding" settlement. The proposed increase would add £29.11 per week for Band D households starting in the 2027/28 fiscal year, reflecting a loss of over half its government grant from £150.5 million to £72.4 million over four years.
Written locally by qwen2.5:14b on 2026-10-03,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Story summary
Hammersmith and Fulham Council, a Labour-led authority in west London, is considering raising council tax by up to 150% next year due to significant funding cuts from the central government. The proposed increase would mean that Band D households, currently paying £1,519 annually, would face an additional £29.11 per week or £1,483.60 per year. This drastic measure is part of a broader review by Labour's "Fair Funding" initiative which aims to redistribute funds from affluent areas to others hit harder by austerity measures but could force some councils to raise taxes dramatically.
Ministers argue that local authorities with historically low council tax levels will face significant reductions in their government grants, compelling them to align their tax rates with national averages. Hammersmith and Fulham Council would lose over 40% of its £222 million annual budget under this review, making a substantial increase necessary for maintaining current services.
Other affluent London boroughs like Westminster, Kensington and Chelsea, Wandsworth, City of London, and Windsor and Maidenhead are also facing similar challenges but are mostly led by the Conservative Party. For instance, Tory-run Wandsworth Council has already announced a 94% tax hike. Hammersmith and Fulham remains unique as it is the only Labour-led council impacted by such severe budget cuts under the new funding settlement.
Written for “London Council Tax Hike Considered” on 2026-10-05,
grounded in this article and the 1 other(s) covering the same event.
A flagship Labour authority has warned it may have to impose a 150% council tax rise on residents to maintain current services following central government cuts under a new funding settlement.
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it → warn → settlement
Hammersmith and Fulham council’s cabinet has concluded in a report due to be published on Monday that such a rise would cost Band D households an additional £29.11 a week in 2027/28.
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rise → conclude → 2027/28
The west London council has said it is losing more than half of its government grant under Labour’s “fair funding” review, which was introduced last year to redirect cash from affluent areas to places hit hardest by austerity.
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which → say → austerity
Ministers have argued that the review will mean that local authorities with “historically low” council tax levels will have the cash they receive from Whitehall slashed, forcing them to bring bills into line with national averages to make up shortfalls.
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they → argue → shortfalls
Hammersmith and Fulham, along with Westminster, Kensington and Chelsea, Wandsworth, City of London, and Windsor and Maidenhead councils, have been given powers to raise bills above the 5% cap next year to balance its budget in the wake of cuts.
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Hammersmith → give → cuts
A household in Band D currently pays £1,519 annually, including the £510.51 City Hall surcharge, known as the Greater London Authority (GLA) precept.
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household → pay → precept
In a document seen by the Guardian, the councillor Rowan Ree, serving as cabinet member for finance and reform, said the council was “facing the biggest financial challenge in living memory” under the new funding formula.
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council → see → formula
The council received £150.5m in government funding in 2025/26, but this will be cut by more than half to £72.4m over the next four years.
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this → receive → years
“Various scenarios in this report show the deep extent that Hammersmith and Fulham council could be required to raise its element of the council tax (which excludes the GLA precept) during 2027/28,” he said.
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he → show → 2027/28
Scenarios include:
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A 100% increase in the Hammersmith and Fulham council tax element – £2,018 a year at Band D – leaving a budget shortfall of £46.1m. “For a family in a Band D property that would mean an increase of £19.40 a week,” the document said.
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document → include → 19.40
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A 125% increase in the Hammersmith and Fulham council tax element – £2,270.25 a year at Band D – leaving a budget shortfall of £20.6m.
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increase → leave → m.
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A 150% increase in the Hammersmith and Fulham council tax element – £2,522.50 a year at Band D – which would broadly balance the budget on current assumptions.
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which → balance → assumptions
According to the document, a family in a Band D property would pay an increase of £29.11 a week.
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family → accord → 29.11
Under rules set by Angela Rayner at the start of last year, cash was supposed to be redirected from affluent rural areas to urban councils hit hardest by austerity.
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cash → set → austerity
Ministers said the changes put in place a fairer system that recognised the extra needs and weaker council tax-raising powers of councils in “left-behind” areas.
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that → say → areas
But Hammersmith and Fulham’s Labour councillors argue that they have kept bills low with “ruthless” cost cutting in a borough that has significant areas of deprivation.
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that → argue → deprivation
They claim that the council’s inclusive economic growth strategy, Upstream London, has attracted more than £6bn of investment into the borough and created 17,200 jobs.
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strategy → claim → jobs
London boroughs affected by the formula argue that flawed deprivation measures risk undermining the government’s aim of ensuring funding follows need.
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funding → affect → need
In a letter to Andy Burnham in August, the Conservative leaders of Kensington and Chelsea, Westminster and Wandsworth councils urged a rethink of the proposals.
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leaders → urge → proposals
A spokesperson for the Ministry of Housing, Communities and Local Government said: “Local authorities decide the level of council tax they wish to set, but we are clear that in doing so they should put taxpayers first.
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they → say → taxpayers
“We’ve made over £78bn available for council finances next year, with the majority of money unringfenced so local leaders can decide how best to spend on their local priorities.”
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leaders → make → priorities
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