Cllr Peter Zinkin is the Leader of the Conservative Group on Barnet Council.

All London councils increasingly face the dilemma of having to cut universal services to fund statutory services for individuals, whether for adults, children, or those in temporary accommodation. The national debate over very many years has not yet resolved how these costs should be met. By imposing statutory duties on local government without adequate funding, central government is effectively writing a blank cheque against our residents, who ultimately bear the cost.

In a rational tax system, the level of council tax paid should reflect the services received by residents and their families, not the number of nonagenarians or emergency housing cases in a borough.

Recent announcements by MHCLG regarding changes to the funding formula risk worsening the situation. Their attempt to allocate funding based on demographics and social need could have been a step forward, but three pieces of political dogma undermined the effort:

  • The belief that it’s unfair for northern residents to pay more council tax than some London boroughs.
  • The belief of central government that it can impose costly duties on local authorities without funding them.
  • The proposal to transfer over £2bn to areas Labour fears losing in the next election, with little regard for actual need.

The slogan “Why should Oldham pay a higher Band D council tax than a typical London borough?” may be politically catchy, but it reflects fiscal ignorance. What truly matters is the overall cost of living in places like Oldham or London, which includes factors such as housing costs and local earnings. Basing policy on just one component is not only bad economics, but also a deliberate distortion aimed at pumping money into threatened marginal seats.

The proposed funding formula assumes a Band D council tax of £2,000. Many London boroughs, including Barnet, fall below this threshold. The formula treats £2,000 as a magic number, reducing government grants accordingly. Worse still, MHCLG prevents councils from raising council tax to meet this target which MHCLG itself created. The referendum override is absurd in these circumstances. Over time, compounding will only widen the gap, deepening the financial strain.

The incompetence of this Labour government knows no bounds.

The Conservative Party must remain committed to low taxation. Previous Conservative administrations in Barnet kept council tax at the lowest possible level, in line with the wishes of our residents. But in a world where government writes blank cheques and residents expect efficient services, even after stripping out Labour’s ‘woke’ spending, Barnet and similar councils face large, unfunded deficits under the current funding proposals. Borrowing for the foreseeable future to fund budget deficits is not a viable solution.

Ultimately, the result will be financial chaos, with essential services cut to reduce expenditure. Local government financing urgently needs reform, but this blatant political gerrymandering only worsens the problem.

The current structure of council funding in London is unsustainable. Unless the funding formula is revised to reflect genuine local need or unless, in desperation, the government mandates a minimum Band D council tax level, the crisis will deepen.