Council tax: Sadiq Khan to hike London levy by almost £40 as TfL fares rise by 6%

The rise will see an average Band D London property pay an extra £38.55 a year, from April.

Cash-strapped Londoners are set to see their council tax and TfL bills rise by the biggest amount in decades.

Mayor Sadiq Khan today (Wednesday, January 18) confirmed the double hit to residents' pockets, amid fears over the ongoing cost of living crisis.

Boroughs charge their residents council tax to fund local services, such as waste collection, and the mayor sets an additional sum - or ‘precept’ on top - which goes toward capital-wide spending such as the police, Transport for London (TfL) and the fire service.

The rise will see an average Band D London property pay an extra £38.55 a year, from April.

A TfL fare rise of 5.9% will also leave Londoner’s wallets stretched, as Tube, train and bus fares are set to go up on March 5, 2023, in line with national rail prices.

Sadiq Khan is increasing council tax. Pictured, City Hall. Photo: Getty

It’s the highest council tax hike for 20 years and the biggest TfL bump in a decade.

The mayor said: “The last thing I want to do is increase council tax at a time when many household budgets are stretched. But the government’s refusal to provide the funding our city needs means I’ve been left with no viable alternative but to help plug the gap.”

But opponents hit back, saying the rise was “eye-watering” and: “London simply cannot afford another four years of this Mayor."

Plans have been unveiled to:

  • Increase the mayor’s average precept by £15 to fund an extra 500 PCSOs;
  • Raise bills by an average of £20 to go towards plugging TfL’s budget gap;
  • And charge households another £3.55 on average for the fire service.
Mayor of London, Sadiq Khan. Credit: Getty Images

Funding will raise an additional £29.3m for the Met and City Hall says the new PCSOs - a 50% increase in numbers - will work in areas disproportionately affected by crime.

Commissioner Sir Mark Rowley has said the force needs a further £827m a year to maintain the real-terms per-head budget as in 2010-11.

It comes just days after revelations the Met Police missed several opportunities to stop rapist cop David Carrick who confessed to a horrific string of sex attacks, including 20 rapes.

Average council tax bills will be £434.14 a year - but the mayor says almost half of properties are in lower Band A-C areas and households will pay less.

City Hall says the move is a result of insufficient government funding for London’s frontline public services, and the cash will help reduce crime and protect transport.

This week’s strikes are said to be the biggest since 2017, when Tube stations were locked up - like at Waterloo in the photo above. Credit: BEN STANSALL/AFP via Getty Images

TfL is also struggling with a funding gap, and - under the terms of the emergency funding deal - City Hall must raise more than £500m a year from new sources.

Tube pay as you go fares in Zone 1, which tend to be tourism or leisure trips, will rise by 30p - intended to cut costs for those travelling from outside central London into the city for work.

Mayor Khan said: “Bearing down on violent crime and making our city safer for everyone remains my number one priority.

“I froze TfL fares for five years from 2016 to make transport more affordable for millions of Londoners. But my hands have been tied since the pandemic by strict conditions set by the government in the recent emergency funding agreement for TfL.

“This is a challenging time for our city, with the government not fully funding public services. I’m determined to step up so that we can continue building a greener, safer and fairer London for everyone.”

Peter Fortune, GLA Conservatives deputy leader said: "London is now facing a major cost of Khan crisis.

“Sadiq Khan’s council tax will have risen 57% since he was elected, as he hits Londoners with another big increase in fares and a ULEZ tax that targets the poorest.

“The mayor wants to impose an eye-watering and unaffordable cost of living burden on Londoners to compensate for his own financial mismanagement.”