Hammersmith and Fulham Not Planning to Challenge Fair Funding
Council leader says legal advice shows any action would fail
Stephen Cowan says borough has hired a 'world-class' King's Counsel
October 3, 2026
Hammersmith and Fulham Council will not launch a formal challenge to the Government’s Fair Funding reforms, which would significantly reduce the amount of financial support it received from the government, after receiving advice from a senior lawyer.
The borough’s Leader Stephen Cowan revealed the authority had sought the opinion during a London Councils fringe event at the Labour Party Conference. He said the council had hired a “world-class KC (King’s Counsel)”, who found there was a “very low likelihood” of winning any potential action.
The decision contrasts with that of the Conservative councils in Westminster, Wandsworth and Kensington and Chelsea, who have said they will pursue a challenge under the Sustainable Communities Act. The City of London Corporation has also said it will consider an appeal.
Cllr Cowan, who has led Hammersmith and Fulham since Labour took power in 2014, was speaking on a panel organised by the umbrella group London Councils.
In a ranging discussion he was asked about the Government’s Fair Funding reforms, under which grants will be redirected to councils deemed to be in the greatest need.
While some authorities will benefit, others, including several in Inner London, are to see their funding slashed.
Wandsworth has warned it may have to increase council tax by 94 per cent from April 2027, having been given special dispensation to go beyond the 4.99 per cent threshold without a referendum.
This would take Wandsworth’s average council tax to a rate similar to the London average, though the scale of the rise would no doubt burden borough residents.
Westminster meanwhile has said that if the reforms proceed as planned it will see its grant funding cut from £219m to £119m over the next four years, with council tax to have to rise by 200 per cent.
Hammersmith and Fulham, which is yet to announce its tax plans for the year ahead, is also one of those to have been given permission to go above the 4.99 per cent cap.
Asked by the interviewer whether Hammersmith and Fulham would be introducing large council tax rises, Cllr Cowan said a hike is one of the options being considered though the priority is reducing costs.
He was also asked about the potential action threatened by other councils, and whether Hammersmith and Fulham was tempted to join. Cllr Cowan said the local authority had hired a “world-class KC” to advise on whether a challenge was viable.
“I’m not interested in anything other than a win,” he said. “When you’re talking to a lawyer you say to them what are our chances…50 per cent chance of winning, is it a 40 per cent chance of winning, 70 per cent chance? We’ve been given a very low likelihood of winning any…action, so we’re not going to pursue that route.”
A Ministry of Housing, Communities and Local Government (MHCLG) 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, with the majority of money un-ringfenced so local leaders can decide how best to spend on their local priorities.
“And we’re fixing an outdated funding system so funding goes where need is greatest, while protecting councils through the transition and ensuring no area faces a cliff edge.”
In a Hammersmith and Fulham Council update published this week, Rowan Ree, Cabinet Member for Finance and Reform, wrote he has been working with councillors, officers and MPs to push the Government to review the scheme.
“However, the likelihood remains that the Government’s ‘Fair Funding’ changes will go ahead,” he wrote. “Therefore, I am looking at all options to meet the legal requirement to present a balanced council budget for next year and each of the subsequent years over the Government’s three-year funding settlement.”
Cllr Ree added it is expected the funding cut could equate to 40 per cent of the local authority’s total budget of £222m, at a time when demand and costs for essential services continue to increase.
“The scale of the Government funding reduction over the next four years means our efficiency savings alone will not be enough to close this budget gap. As a result, we must look at all our options.
“I am determined H&F remains Britain’s best value council. In H&F, people have services they simply wouldn’t get if they lived elsewhere – from protecting residents during the cost-of-living crisis, to investing in young people and funding vital youth services and taking extra measures to cut crime and keep people safe.”
Council taxpayers will soon be asked for their views, Cllr Ree concluded, “to ensure your voice is heard as we work to protect the services you value the most”.
Ben Lynch - Local Democracy Reporter