Kensington and Chelsea Council aims for a careful balance with a 4% council tax increase and targeted support for low-income residents amid a growing financial crisis impacting London boroughs due to government funding cuts, rising homelessness, and housing shortages.
Kensington and Chelsea Council is preparing to implement significant changes to council tax aimed at addressing a £139 million funding gap. One of the most notable adjustments involves charging low-income residents council tax for the first time, alongside plans to double council tax bills for owners of second homes. The council attributes these measures directly to government funding cuts stemming from the Fair Funding Review, which they say have left them facing unavoidable tax increases and reductions in public services.
These local moves reflect a much broader crisis confronting London's boroughs. London Councils, the cross-borough representative body, has issued stark warnings about the capital's financial future. It projects a cumulative shortfall of £4.7 billion by 2029, with boroughs already grappling with a £1 billion gap this year alone. The implications are dire, with around half of London's boroughs potentially requiring emergency government bailouts to stave off bankruptcy within the next few years.
The pressure on council finances is exacerbated by surging demand for public services, including an acute homelessness crisis. London Councils highlights that boroughs have already overspent on homelessness support by at least £330 million in the current financial year, a 60% increase over budgeted amounts. This reflects the legal obligations local authorities face to provide temporary accommodation to homeless households qualifying under housing law, a responsibility that is becoming increasingly expensive as homelessness rates rise.
Further compounding the financial strain are the enduring challenges posed by the capital’s ongoing housing crisis. London Councils describes this issue as the "fastest-growing risk" to borough budgets, warning that the combined pressures of increased homelessness and deteriorating social housing conditions could push more councils toward effective bankruptcy. The organisation forecasts a shortfall of around £700 million next year unless central government steps in with additional funding support.
Despite these daunting financial challenges, Kensington and Chelsea Council recently approved a budget for 2025/26 that aims to keep council tax rises relatively low, increasing rates by just four per cent, one of the smallest increases announced among London boroughs. The council also plans to offer targeted support to approximately 15,000 low-income residents through a one-off £50 payment this spring, intended to help mitigate the cost-of-living pressures faced by many residents.
However, while the council aims to balance fiscal responsibility with support, the broader context remains troubling. The accumulated pressures from government funding cuts, the soaring cost of homelessness, and housing shortages are placing London’s local authorities under severe stress, with experts and local leaders warning that without more robust and sustained government intervention, many boroughs will struggle to maintain essential services and financial stability.
📌 Reference Map:
- [1] (Evening Standard) - Paragraph 1, Paragraph 2, Paragraph 5
- [3] (London Councils) - Paragraph 2, Paragraph 3
- [6] (London Councils) - Paragraph 3
- [7] (London Councils) - Paragraph 4
- [5] (Kensington and Chelsea Council) - Paragraph 5
- [4] (London Councils) - Paragraph 2
Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative presents recent developments regarding Kensington and Chelsea Council's proposed council tax changes to address a £139 million funding gap. The earliest known publication date of similar content is 9 July 2025, when The Standard reported on the council's projected £82.7 million shortfall over three years due to government funding reforms. ([standard.co.uk](https://www.standard.co.uk/news/politics/council-tax-rise-london-funding-reforms-kensington-westminster-wandsworth-b1236830.html?utm_source=openai)) The current report builds upon this earlier information, incorporating new details about the council's proposed measures, such as charging low-income residents council tax for the first time and doubling bills for second-home owners. The inclusion of updated data justifies a higher freshness score but should still be flagged. The narrative appears to be based on a press release from Kensington and Chelsea Council, which typically warrants a high freshness score. ([rbkc.gov.uk](https://www.rbkc.gov.uk/newsroom/kensington-and-chelsea-set-balanced-and-fair-budget-low-tax-and-support-residents?utm_source=openai)) However, the report's reliance on a single source and the lack of coverage from other reputable outlets may raise concerns about its originality. Additionally, the narrative includes updated data but recycles older material, which may justify a higher freshness score but should still be flagged. The report also mentions that the council is considering charging a council tax premium on second homes within the borough, as well as exploring difficult options around reducing the council tax reduction scheme.
Quotes check
Score:
7
Notes:
The narrative includes direct quotes from Cllr Elizabeth Campbell, Leader of Kensington and Chelsea Council, stating:
> "We are facing cuts of £82 million because of the Government’s fair funding review. It is our biggest budget challenge yet and it means very tough decisions ahead."
A search for the earliest known usage of this quote reveals that it was first reported by The Standard on 9 July 2025. ([standard.co.uk](https://www.standard.co.uk/news/politics/council-tax-rise-london-funding-reforms-kensington-westminster-wandsworth-b1236830.html?utm_source=openai)) The identical wording in the current report suggests that the quote has been reused. However, no online matches were found for the specific phrasing used in the current report, indicating that the quote may be original or exclusive content.
Source reliability
Score:
6
Notes:
The narrative originates from The Standard, a reputable UK newspaper. However, the report relies heavily on a single source, Kensington and Chelsea Council's press release, which may raise concerns about the originality and reliability of the information presented. The lack of coverage from other reputable outlets further compounds this issue.
Plausability check
Score:
8
Notes:
The narrative presents plausible claims regarding Kensington and Chelsea Council's proposed council tax changes to address a £139 million funding gap. The council's projected £82.7 million shortfall over three years due to government funding reforms is consistent with previous reports. ([standard.co.uk](https://www.standard.co.uk/news/politics/council-tax-rise-london-funding-reforms-kensington-westminster-wandsworth-b1236830.html?utm_source=openai)) The proposed measures, such as charging low-income residents council tax for the first time and doubling bills for second-home owners, align with the council's stated intentions to balance the budget. However, the lack of supporting detail from other reputable outlets and the reliance on a single source may raise concerns about the narrative's credibility.
Overall assessment
Verdict (FAIL, OPEN, PASS): FAIL
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The narrative presents plausible claims regarding Kensington and Chelsea Council's proposed council tax changes to address a £139 million funding gap. However, the heavy reliance on a single source, the recycling of older material, and the lack of coverage from other reputable outlets raise concerns about the narrative's originality and reliability. The identical reuse of a direct quote from a previous report further diminishes the narrative's credibility. Therefore, the overall assessment is a 'FAIL' with medium confidence.
