Government cuts force Mayor to propose 27p a week council tax increase

21 December 2017

• Mayor left with no choice in order to help keep Londoners safe

• All additional money raised will go to Metropolitan Police and London Fire Brigade who have been hit with Government funding cuts

• Additional funding for the Met goes above and beyond £12 allowed by Ministers on Tuesday

• Sadiq says ministers should “hang their heads in shame” at failure to protect Londoners adequately

The Mayor of London, Sadiq Khan, has today announced proposals to increase his share of council tax from April 2018 by an average of 27p a week – the maximum amount allowed by the Government.
All of the additional money raised will help fund the Metropolitan Police and London Fire Brigade.

Keeping Londoners safe is the Mayor’s top priority. With the Government refusing to give the Met and Fire Brigade the resources they need to do their jobs, Sadiq’s proposal would see his share of council tax increase overall by 5.1 per cent or £14.20 a year in cash terms.

Despite the four terror attacks on London - the country’s capital - and the devastating fire at Grenfell Tower in the last year, the Government confirmed on Tuesday that it is proposing another year of real-term cuts to the funding of the Met. The Met has had to make more than £600 million of savings over recent years, and must find several hundreds of millions more of savings by 2021/22.
The Mayor’s share of council tax is split into two – money that goes to the Metropolitan Police, known as the Policing Precept, and money that goes to fund other services, known as the non-Policing Precept.

On Tuesday, the Government announced that they would not increase funding for the Metropolitan Police, but that Sadiq could increase his Policing Precept by a maximum of £12 a year before having to hold a council tax referendum.

Reluctantly, as a result of Government cuts, the Mayor is inclined to increase his share of council tax that goes to the Police by the maximum amount that does not require a referendum. This is the equivalent of 23p a week - a 5.8 per cent Policing Precept increase.

The Mayor also intends to increase his non-Policing Precept by 2.99 per cent, again the maximum permitted by the Government. This is the equivalent of £2.20 a year or just over 4p a week. As a result of the Government not giving the London Fire Brigade the funds Commissioner Dany Cotton said were needed in response to the lessons from the Grenfell Tower fire - the proceeds of this will be shared between the Mayor’s Office for Policing and Crime and the London Fire Brigade.

Overall, this means that the Mayor’s overall precept for an average Band D taxpayer will increase from £280.02 to £294.22.

Speaking ahead of today’s London Assembly Policing Plenary, the Mayor of London, Sadiq Khan, said: “Nothing is more important to me than keeping Londoners safe. The Government has refused to back the Metropolitan Police or the London Fire Brigade with the money they need and so I have been left with no choice but to propose increasing council tax to protect our city from the threats that we face.

“I’m sensitive to the fact that council tax is a regressive form of taxation – as it hits those who can least afford to pay it the hardest, so this is certainly not a decision I take lightly.

“This year, London has faced dreadful tragedy caused by four terror attacks and the Grenfell Tower fire. The capital’s population is rising, as is reported crime both in the capital and across the country. As the capital of our country and a global city, we host major music, sporting and cultural events and attract a record number of visitors. Ministers should hang their heads in shame at their abject failure to protect Londoners by adequately funding our police and fire service and for leaving it to taxpayers here in London to help to bridge the gap.

“For the Government to pretend they are riding to the rescue of the police with £450million extra funding would be laughable if the impact on public safety wasn’t so serious. The facts are, the Government have not increased funding and are expecting council taxpayers to pick-up most of the bill and it still doesn’t undo the cuts they’ve imposed on the police.”

While the Mayor is doing all he can to find additional funds from council tax to support and protect frontline policing, the Government controls 70 per cent of Met funding. The Met has had to make more than £600 million of savings in recent years and must find several hundreds of millions more of savings by 2021/22. This has already led to the loss of 30 per cent of police staff posts, and 65 per cent of police community support officers posts, plus most of the capital’s police station front counters and 120 police buildings. When Sadiq increased the policing element of council tax last year, he raised an additional £25.3m for the Met.

The latest projections show that if the funding crisis does not end now, and if all savings come from officer numbers, then police officer numbers in the capital could fall significantly below 30,000 before 2021 – a dangerous low which presents a serious risk to the safety of Londoners.

While the Government’s apparent increase in funding for Counter Terrorism is welcome it is not sufficient, representing only a 1.3 per cent increase compared to 2017-18’s forecast expenditure. For every £1 of Counter Terrorism spend in response to an incident, around £2 is spent on necessary additional non-Counter Terrorism activity, which has to come from wider policing budgets.

The Mayor has also repeatedly called for full funding of the National and International Capital Cities (NICC) Grant, to reflect the true – and accepted – additional costs that come with policing the capital. The Met spends some £346m a year on this work, which includes diplomatic protection, and policing major events such as protests, concerts, football matches and state visits. The Home Office should reimburse Londoners for this work through the National and International Capital Cities (NICC) Grant, but currently underfunds London by around £172m a year. When the Home Office’s own expert panel reviewed the figures, it suggested the Met should receive £281m a year. So, on either calculation, the Met is significantly short-changed and the Government has refused to even increase this amount to reflect inflation.

Similarly, the Fire Brigade is facing relentless real-terms cuts from the Government at the same time as having to address the many issues raised by the Grenfell Tower fire. Sadiq believes that unless he takes action now, not only will he not be able to provide the additional resources identified as necessary in the aftermath of Grenfell, but front-line services may also need to be cut later.
These council tax proposals will be contained within the Mayor’s draft budget, which will be published for consultation later this week. This budget will set out Sadiq’s plans to help ensure that all Londoners get the opportunities that the city gave to him.

The draft 2018/2019 budget will cover the entire Greater London Authority Group – including Transport for London, the London Legacy Development Corporation, the Metropolitan Police service and the London Fire Brigade. Its plans include:

• a freeze on all TfL fares during the Mayor’s first administration, while protecting concessions and extending the new Hopper bus fare.

• Continuing investment in skills, and supporting new and innovative businesses to invest in London.

• Further investment in London’s cultural and creative offering, and in particular the Cultural and Educational District (CED) in the Queen Elizabeth Olympic Park.

• Tackling London’s filthy air, amongst other measures, the Mayor has introduced in central London the Toxicity-Charge (T-Charge), will introduce the Ultra-Low Emission Zone (ULEZ) in 2019 and is consulting on expanding the ULEZ up to the North and South circular roads in 2021.

• Measures to turn around London’s housing crisis from the dreadful situation Sadiq inherited from his predecessor. He is investing £3.15 billion to support 90,000 new genuinely affordable homes in the capital and ripping up old planning rules to get London building, while protecting the Green Belt.

• Record investment in modernising our transport infrastructure, with the new Elizabeth line scheduled to begin operating through central London by the end of 2018.

• Continuing to work with London’s businesses, investors and innovators to ensure London’s key sectors are protected and Londoners’ economic opportunities are maximised during the negotiations to leave the European Union.

• Building on the existing budget for the Mayor’s environment programme, which includes £10 million earmarked for energy efficiency activity and measures to tackle fuel poverty. Over the next three years, £750,000 is being allocated to help reduce plastic bottle waste and increase access to tap water.

A consultation document that sets out the Mayor’s proposals will be made available on the Greater London Authority website later this week at:

Members of the public will have until 12 January 2018 to comment on the draft Budget. The Budget is due to be considered by the London Assembly on 25 January and 22 February.
The Budget will be agreed on February 22.

Notes to editors

• The Mayor’s council tax proposals include an overall 5.1 per cent increase to his total precept. All of the proceeds will go to the Metropolitan Police and the London Fire Brigade.

• The Mayor of London’s 2018-19 draft Council Tax requirement is £862m – this being the total sum forecast to be collected from Londoners to fund GLA services. Under the proposal the total GLA precept will be increased from £280.02 to £294.22 a year (Band D household) for residents of the 32 boroughs – an overall increase of £14.20. All of this increase will be provided to the Metropolitan Police and the London Fire Brigade.

• This equates to a Policing Precept increase from £206.13 to £218.13 and a non-Policing Precept from £73.89 to £76.09 a year.

• Of the non-Policing precept, 2.99 per cent of the increase will go to London Fire Brigade but effectively one per cent will go to the Mayor’s Office for Policing and Crime by a reallocation of business rates from the Fire Brigade to MOPAC. This is necessary to avoid a Council Tax referendum.

• The Mayor’s proposed council tax precept comprises £639m to support the Metropolitan Police service, £147m for the London Fire Brigade and £76m for other services such as transport and the GLA itself.

• The Mayor’s draft budget consists of allocations for - the Mayor’s Office for Policing And Crime (Metropolitan Police), Transport for London, the London Fire Commissioner (London Fire Brigade), the London Legacy Development Company (Queen Elizabeth Olympic Park), the Old Oak Common and Park Royal Development Corporation, the core Greater London Authority and the London Assembly.

• The proposed total budget for the GLA Group for 2018-19 is £15.9 billion. This comprises a revenue budget of £11.8 billion and a draft capital spending plan of £4.1 billion.

• The consultation document, which outlines the Mayor’s proposals, will be circulated to all 32 London Borough Councils, the Corporation of London, key business representative bodies and other key stakeholders representing London’s wide range of interests.

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