Four London boroughs submit revised funding bids as Fair Funding Review 2.0 threatens up to 58% cuts
Wandsworth plans a 94% council‑tax rise and closure of its £6.2 million reserve while Kensington & Chelsea, Richmond and Westminster face multi‑million funding losses.
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BBC London reported that the leaders of Wandsworth, Richmond, Westminster and Kensington and Chelsea councils formally delivered revised funding bids to the Treasury on Thursday. The bids seek to mitigate the impact of the Fair Funding Review 2.0, a government‑led overhaul of the local‑authority funding formula.
Scale of the projected cuts
Wandsworth, Richmond, Kensington & Chelsea and Westminster face up to £108m funding cuts
Council leaders submitted revised funding plans to the Treasury on 22 October 2026, warning of service reductions and tax hikes as the Fair Funding Review 2.0 cuts central grants.
According to the council leaders, the new formula would slash their central grants by between 40% and 58% by 2029. Kensington and Chelsea is projected to lose more than £108 million, which represents over 40% of its current central funding. Richmond faces a £26 million reduction, equivalent to a 58% cut. Westminster’s share is expected to fall by roughly £100 million, about 46% of its present allocation.
Wandsworth’s tax rise and reserve closure
Wandsworth Council, led by Conservative minority leader Robert Morritt, said the reforms would force a 94% increase in council tax from April. The council also intends to shut its £6.2 million cost‑of‑living reserve, replace the Access for All scheme with a smaller concessionary programme, cancel its Borough of Sanctuary status and suspend voluntary‑sector grants for four years.
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"Residents should not have to pick up the bill for changes imposed by Whitehall. This proposal takes our case directly to government."
Robert Morritt, Wandsworth Council leader
Responses from other boroughs
Richmond Liberal Democrat leader Gareth Roberts warned that the cuts could push the council to a financial cliff edge. Kensington and Chelsea Conservative leader Elizabeth Campbell said she will use every tool available to protect residents and secure a fair deal. Westminster’s leadership has not issued a direct quote in the BBC report but is included in the overall submission.
What happens next
The revised proposals are now subject to review under the Sustainable Communities Act. The Treasury will consider the arguments before any final decision on the funding formula is made. Councils have indicated they will continue to use legal and political routes to challenge the reforms if the outcome does not address their concerns.
Questions this report answers
+What cuts are the four councils facing under the Fair Funding Review 2.0?
The review could cut central funding by 40% for Wandsworth, more than 40% (£108 million) for Kensington and Chelsea, 58% (£26 million) for Richmond and about 46% (£100 million) for Westminster by 2029. The reductions stem from a new formula that reallocates money toward more deprived areas.
+How much will Wandsworth council tax increase and what else is being changed?
Wandsworth Council proposes a 94% rise in council tax starting in April. In addition, the borough will close its £6.2 million cost‑of‑living reserve, scale back its concessionary scheme, end its Borough of Sanctuary status and suspend voluntary‑sector grants for four years.
+What is the expected financial impact on Kensington and Chelsea?
Kensington and Chelsea is expected to lose £108 million of central funding over the next four years, which is more than 40% of its current allocation. The loss forms part of the broader cuts projected by the Fair Funding Review 2.0.
+What steps are the councils taking after submitting their revised proposals?
The councils have lodged their revised bids under the Sustainable Communities Act. The Treasury will now review the submissions. Council leaders have said they will pursue every available legal and political avenue if the final funding decision does not mitigate the projected cuts.
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