Hammersmith and Fulham warns of 150% council tax rise after grant cut
Hammersmith and Fulham council has warned it may have to raise council tax by up to 150% after its government grant was more than halved under Labour's 'fair funding' review, costing Band D households an extra £29.11 a week.
The Labour-run London borough of Hammersmith and Fulham has warned it may have to impose a council tax rise of up to 150% — one of the largest increases ever proposed by an English council — after losing more than half of its government grant.
A budget report published on Monday says the borough, which currently has the third-lowest council tax in England, could raise bills by 100%, 125% or 150%. Only the 150% scenario — costing Band D households an extra £29.11 a week from the 2027/28 tax year — would leave no budget shortfall, according to the report, which was first seen by The Independent.
The council blames Labour’s “fair funding” review, introduced last year to redirect money from affluent areas to places hit hardest by austerity. Government funding for Hammersmith and Fulham will fall from £150.5 million in 2025/26 to just £72.4 million over the next four years. Councillor Rowan Ree, the cabinet member for finance and reform, said the reduction could be equivalent to losing 40% of the council’s £222 million total annual budget.
A 100% rise (£19.40 a week for a Band D property) would still leave a £46.1 million shortfall, and a 125% rise (£24.25 a week) would leave a £20.6 million gap, the report says. The 150% increase would bring in an additional £163.9 million by 2030/31, which “broadly balances the budget on current assumptions”.
Hammersmith and Fulham is one of six councils — alongside Westminster, Kensington and Chelsea, Wandsworth, the City of London, and Windsor and Maidenhead — that the government has allowed to raise council tax above the standard 5% cap. Neighbouring Wandsworth and Westminster have warned they may need rises of 188% and 200% respectively.
Ree said the council had pioneered a “Ruthless Financial Efficiency” programme that has saved £156 million since 2014, and accused ministers of aiming “to make councils with historically low council tax raise them to the national average”. He said the council was “vigorously” challenging the government to review the measures.
A Ministry of Housing, Communities and Local Government spokesperson 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. We’ve made over £78 billion available for council finances next year.”
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