Hammersmith and Fulham council, a prominent Labour-controlled authority in London, has warned it may need to raise council tax by as much as 150% to sustain existing services after central government cuts under a new funding settlement.
The council’s cabinet has set out the figure in a report that is due to be published on Monday, concluding that the scale of the funding reduction represents the "biggest financial challenge in living memory." Under the scenario described, Band D households would face an additional £29.11 a week in 2027/28.
The authority said the potential increase would be required to maintain current service levels in the face of the funding changes imposed by Whitehall. The estimate was included as part of a range of projections to show the financial pressures the council expects to encounter in coming years.
The warning highlights tensions between local government finances and central funding decisions, and is likely to draw attention because Hammersmith and Fulham is often viewed as a high-profile example of Labour local administration. The council's report will be scrutinised by councillors and residents when it is published and debated in the weeks ahead.
Council leaders will now need to decide whether to pursue large local tax rises, make deeper cuts to services, or seek other measures to close the funding gap. The forthcoming report is expected to provide further detail on the assumptions behind the projection and the options being considered.
The issue underscores the broader challenge facing many local authorities as they adjust to changes in the funding regime set by central government. Hammersmith and Fulham's calculations provide an early and stark illustration of the choices councils may confront if funding pressures persist.