Protecting Services the Priority Says H&F Council Leader
Conservatives accuse Labour of being slow to face reality of Fair Funding impact
Cllr Ree responds to Cllr Afonso's questions at the Cabinet meeting on Monday. Picture: H&F Council
October 13, 2026
Hammersmith & Fulham Council, which is due to see its Government funding slashed by more than half over the next four years, has said its priority is to avoid cutting services as it heads into its budget-setting process.
The Council Leader Stephen Cowan said the authority is looking at ways to “strip out all that back-office waste” as part of a wider effort to protect front-line services.
The Labour-led local authority has previously warned it may need to increase council tax by an unprecedented 150 per cent in April due to the Government’s Fair Funding reforms.
Speaking at Cabinet on Monday night (12 October), Cllr Cowan said: “The solution for us is to either influence the Government to change its mind or at the same time to introduce the biggest cuts program we’ve ever introduced, which is what we’re in the process of doing.
“We haven’t got the money. We simply can’t maintain the levels of operation that we have been doing. The priority for us is not to cut services, because [for] councils it’s often the first place they go.”
Hammersmith and Fulham Council is one of several London authorities to see their grant funding drastically reduced following the Government’s review. The Fair Funding reforms are intended to rebalance the money given to councils to take greater account of spending needs and revenue-raising abilities.
The Government has agreed to some transitional funding for those to be hardest-hit as well as permission for six authorities, including Hammersmith and Fulham, to hike council tax above the five per cent cap.
Westminster, Kensington and Chelsea, and Wandsworth have said they will look to challenge the Government under the Sustainable Communities Act given the scale of the cuts, with the latter saying it may be forced to increase tax by 94 per cent in April.
Hammersmith and Fulham, which decided against such a challenge after receiving advice from a KC, has warned it may be required to hike bills by an unprecedented 150 per cent. If introduced, this would increase council tax for a Band D property to £2,522.50 a year excluding the Greater London Authority (GLA) precept.
It was one of three scenarios presented in a report which went before Cabinet, the other two being a 100 per cent hike and 125 per cent. The 150 per cent increase is however the only one that would balance the budget over the next four years.
Officers wrote in the report that “combined with changing demographics, rises in priority services costs, and inflation fuelled by national and global issues, this leaves us with an estimated £160m budget gap to fill.
“The effect of the new formula is to make a number of councils – like H&F – where council tax rates have been historically low, raise their council tax to the national average.”
Cllr Ree told members the hit to the authority’s finances is due to the equalisation of council tax under the reforms.
Despite Hammersmith and Fulham coming 120th out of 296 local authorities when it comes to levels of deprivation, the other key part of the formula – the borough’s low tax rates – means it is due to see swingeing cuts equivalent to 40 per cent of its annual budget.
“We have been able to provide services that residents wouldn’t get if they lived anywhere else,” Cllr Ree said.
“Services like the Law Enforcement Team, services like free home care. We pioneered free school breakfasts. We have more CCTV cameras per person than anywhere else in the country. And we’ve been able to do all of that whilst cutting £156 million of waste from our budget. A budget that, for context, is just £220m.”
Cllr Ree said the local authority will continue to work “to make our services as effective and as efficient as possible and to protect residents from the worst impacts of these so-called Fair Funding changes”. He added: “I’m determined that Hammersmith and Fulham will remain the best value for money council in the country.”
Opposition leader Cllr Jose Afonso asked why Cllr Ree had, in an article by the Local Democracy Reporting Service (LDRS) last August, said Hammersmith and Fulham would only see a large tax hike “if the Conservative councillors…are put back in charge”.
“Were you simply misinformed about funding or were you trying to mislead the electorate ahead of an election?” he asked.
Cllr Ree said the facts have changed since last summer, at which point the council was still subject to the five per cent limit on council tax increases and since when the final funding settlement has been received from Government.
“So even if we wanted to, which we don’t, we wouldn’t have been able to increase council tax by 27 per cent,” he said. “Which is what you had claimed. That was what I was responding to. An awful lot has changed since then.”
Cllr Afonso disputed whether the facts have altered in the interim period, with the article based on an IFS report which indicated there would be large budget gaps due to the cuts.
He said: “You haven’t changed your mind because the facts have changed. You’ve changed your tune because reality has come to hit you.”
Cllr Afonso also asked Cllr Cowan about the planned introduction of the Government’s mansion tax, under which owners of properties worth £2m or more will have to pay an annual charge from April 2028.
Cllr Cowan said the local Labour group’s position on the tax has been clear since it was first mooted around a decade ago.
“We’re not in favour of a mansion tax,” he said. “We think it’s not right that councils should be asked to introduce a tax that they don’t get the money for, and indeed only raises £400m. It doesn’t really fill much of the budget gap which the Government inherited.”
Cllr Cowan also warned the tax would likely “cool the housing market”, and reiterated his belief it is the “wrong policy”.
Sympathy was similarly shown with other councils due to be affected by the Fair Funding changes, each of which are also facing having to impose large tax rises on residents.
“Everyone finds themselves in this, and we’re all trying to find different routes,” Cllr Cowan said.
Engagement with residents and other stakeholders on the budget is to run from October 19 to November 15. A draft budget is penned in to go before Cabinet again on February 17, with formal approval proposed at Full Council on March 1.
Ben Lynch - Local Democracy Reporter