Council tax will rise 9.5% in April 2021 as Sadiq Khan tries to make up the budget shortfall left by COVID-19.
Khan announced the increased tax will be used to fund the police, free transport for pensioners and schoolchildren, as well as provide support to the London Fire Brigade to implement changes proposed by Grenfell enquiry.
The Mayor expressed sympathy with families who have struggled financially as a result of the pandemic, and promised income generated would be put to “good and efficient use keeping our public transport system running and keeping Londoners safe”.
The average London household pays £332.07 per year in council tax to City Hall. Under the new proposals, this will rise by approximately £32 annually, hitting poorest families hardest.
The tax hike comes amidst a continued row between the Government and Greater London Authority over who should foot the bill for public transport.
Free travel for under 18s and over 60s is currently funded by the Government to the tune of £125 million annually, but Transport Minister Grant Shapps has said this support will end in the next financial year.
With TfL revenue down 90% due to lockdown measures, City Hall has tried to generate additional income by increasing congestion charge by 30%, and is planning a daily motorists fee of £3.50 for anyone entering London.
London Conservatives have blamed Sadiq Khan for mismanaging TfL finances, and accused him of not considering alternative solutions to the funding crisis.
Tory mayoral candidate Shaun Bailey tweeted: “Khan racked up £9.56 billion of waste at TfL… instead of cutting costs at TfL, or looking to alternative sources of revenue like tube sponsorship, he’s passing the costs on to Londoners”.
However, Labour Party leader Sir Keir Starmer has defended the Mayor, blaming Conservatives cuts for leaving him no option.
Writing in the Telegraph, Starmer wrote: “It is absurd that during the deepest recession in 300 years…Boris Johnson and Rishi Sunak are forcing local government to hike up council tax”.
Meanwhile, many Labour representatives have called for those on higher council tax bandings to cover the costs of the pandemic.
Councillor and former Kensington MP Emma Dent Coad called on wealthy homeowners to pay a higher share for Council services.
Speaking to KCW London, she called on councils “to implement 100% reductions for those in lower bands so it is those who can afford it who bear the burden, not the poor who have been hit hardest by COVID”.