Four London councils urge Treasury to rethink funding reforms
The leaders of four London councils have delivered revised funding proposals to the Treasury, the government department that manages public spending. They are urging a rethink of the rules that decide how much money local authorities receive. The leaders of Wandsworth, Richmond, Westminster and Kensington and Chelsea delivered the proposals on Thursday, 22 October 2026.
The council leaders said the reforms would cut their central funding by between 40% and 58% by 2029. Central funding is the money councils receive from national government.
The changes are known as Fair Funding Review 2.0. They aim to shift more money towards areas with higher deprivation, a measure of social and economic hardship. The four councils submitted their revised proposals under the Sustainable Communities Act, a law that gives councils a route to put proposals to government.
Each council has set out its own figures. Wandsworth said the reforms would cut its funding by 40%. Westminster is due to see its central funding drop by around £100m, or 46%. Kensington and Chelsea is set to lose £108m, more than 40% of its central funding, over the next four years. Richmond is set to lose £26m, or 58% of its core funding.
Richmond's council leader is Gareth Roberts, a Liberal Democrat. Kensington and Chelsea's leader is Elizabeth Campbell, a Conservative.
The UK government said the outdated local authority funding model was being reformed to ensure money goes where it is most needed.
Four London boroughs have launched legal challenges against the Fair Funding Review, LGC Plus reported.
The government's Local Government Finance Policy Statement for 2026-27 to 2028-29 says Fair Funding Review 2.0 sets out how it will deliver a local government funding system fit for the future. A government consultation on the review asks for views on how new funding allocations for local authorities and fire and rescue authorities should be determined. Local government funding is devolved in Scotland, Wales and Northern Ireland, so the review concerns councils in England.
