The Royal Borough of Kensington and Chelsea is formally challenging Government plans to cut its funding by more than 40 per cent, a move that will see the council lose £108 million over the next four years. The challenge will be submitted under the Sustainable Communities Act, a mechanism that allows local authorities to request a reconsideration of Government decisions.
At a Leadership Team meeting on Tuesday, October 13, council leader Elizabeth Campbell said she was “going to carry on fighting for a fairer deal” for the borough. The decision follows a public consultation in which 93 per cent of respondents supported or strongly supported launching the challenge.
Funding loss and council tax context
Kensington and Chelsea is one of several London boroughs affected by the Fairer Funding Review, which has changed how central Government grants are calculated. The council argues it should not be penalised for keeping council tax low. A Band D property in the borough will pay £1,643.44 in council tax for 2026-27, compared with £2,599.91 in Croydon.
Chief Executive Maxine Holdsworth said in a report that the council “should not be penalised for having kept Council Tax as low as possible over the years”. The council has some of the lowest council tax rates in London despite being one of the wealthiest boroughs.
Consultation and cross-party disagreement
The consultation revealed that the top priority for residents was allowing the council to retain a greater share of local income, including business rates, stamp duty and income tax. The second priority was requesting more time to adapt to the funding changes.
However, the challenge will not be cross-party. Councillor Monica Press, leader of the Kensington and Chelsea Group, said she had “extreme concerns about the leadingness” of the consultation. She said her group, along with other Labour groups across London, was advocating for a smoother transition, retaining up to 50 per cent of business rates, and negotiating with the Government.
Other boroughs and next steps
Westminster City Council, the London Borough of Richmond upon Thames and Wandsworth Borough are also submitting similar proposals. The council launched a petition on its website in early September under the headline ‘Help us challenge the Government’s Fair Funding Cuts’.
The formal proposal will now be submitted to the Government, which will have to respond to the council’s request for reconsideration.
