UK Council Tax Reform and Ongoing Labour Leadership Speculation
The UK government has announced changes allowing six areas around London—Kensington and Chelsea; Westminster; Wandsworth; Hammersmith and Fulham; City of London; and Windsor and Maidenhead—to raise their council tax by more than 5% for the fiscal years 2026–27 and 2027–28 without triggering local referendums. These areas were selected due to their very low council tax rates, with Band D payments between £450 and £1,280 below the England average.
This is part of a three-year reform starting in 2026, aiming to shift more government funding toward councils with higher deprivation levels and more properties in lower council tax bands. Labour contends that the current funding rules, last updated in 2013, do not reflect the demand for services, and this reform is intended to address austerity-era cuts. The Institute for Fiscal Studies has noted that these six councils are among those facing the largest reductions in government funding share, with more urban and deprived areas set to see bigger increases, while outer London boroughs might fare better.
Conservative critics accuse the plan of punishing low-tax councils and redirecting funds to Labour-dominated areas, warning that the removal of referendum requirements may lead to service cuts or large tax rises. The government, however, states that overall council funding will increase by £3.9 billion next year, approximately a 5.8% rise, if all councils raise the maximum allowed 5%.
Meanwhile, within the Labour Party, speculation regarding the leadership remains active but without a clear mechanism or imminent challenge to Keir Starmer. A recent briefing involving Wes Streeting was reportedly used to signal to potential challengers that Starmer would firmly contest his position as prime minister; the briefing targeted a broader message rather than Streeting personally. Starmer acknowledged such rumours with humor during a liaison committee appearance. His allies have adopted strategies, including greater engagement with MPs, to counter leadership challenge narratives.
At 10 Downing Street, countermeasures have been less evident compared to the quiet efforts of Amy Richards, the new political secretary, who has encouraged Starmer to increase his time with MPs. Leadership speculation includes several potential contenders such as Wes Streeting, Andy Burnham, Angela Rayner, Ed Miliband, Lucy Powell, and Louise Haigh, alongside discussions of possible kingmakers and the influence of union and NEC dynamics. A credible challenger would need a clear plan for governing differently amid ongoing economic and international turmoil. The general mood in Westminster is described as febrile, with leadership challenges remaining speculative rather than imminent.
