Westminster City Council will eliminate 520 positions from its workforce of 3,720 staff members as it confronts a projected £160m budget shortfall by 2029. The redundancies, described by BBC News as the authority's largest-ever single round of job losses, will focus heavily on managerial and senior roles while attempting to preserve frontline services. Staff learned of the announcement at a City Hall meeting led by chief executive Stuart Love on Tuesday.
The authority aims to save £29m in the coming financial year through these cuts, with an additional £16m in savings expected from renegotiating how it leases and rents buildings. Paul Fisher, the council's cabinet member for value for money and finance, characterised the decision as difficult but necessary, stating that the council hoped the restructure would deliver long-term benefits. According to AOL, the 520 cuts will affect departments across the organisation while prioritising management reductions over frontline posts.
The redundancies stem from a dramatic shift in government funding. Westminster received £219m in central government grant funding during 2025/26, but following the government's fair funding review, that figure is expected to fall to £119m—a reduction of £100m. Because this cut is exceptionally large, the government has arranged for it to decrease gradually: the council will receive £20m less in 2026/27, with subsequent reductions averaging £25m annually until 2029/30.
Why is Westminster facing such severe cuts?
The government's fair funding programme, designed to direct resources toward the most deprived areas, has fundamentally altered the distribution of council funding across England. The government previously stated it was fixing an outdated funding system "so funding goes where need is greatest, while protecting councils through the transition". However, this has created significant challenges for central London boroughs that historically received lower allocations because their council tax rates were kept deliberately low.
Several London boroughs, particularly those in central London, have been hard hit by this reallocation. Westminster will join the Royal Borough of Kensington and Chelsea, Richmond Council and Wandsworth Council in formally challenging the government on the issue, with the four authorities expected to hand a letter to the government later in the week. Local leaders argue they are being penalised for spending more efficiently than high-tax boroughs and have not had adequate time to plan for the changes.
Some critics have suggested that if Westminster and other central London boroughs could afford to maintain very low council tax rates, they may not require as much central government funding. While many London boroughs charge an average Band D council tax exceeding £2,000, Westminster's council tax has remained exceptionally low. For the 2026/27 tax year, the standard Band D council tax in Westminster was £1,047.85—the second lowest in the country, with £537.34 going to the council and £510.51 to the Greater London Authority.
How will the council maintain services during the cuts?
Fisher said the council planned to become more efficient and maintain "valued resident services" by increasing its use of technology such as artificial intelligence and pursuing commercial opportunities. The council has launched a transformation initiative intended to deliver at least £30m in savings through greater use of technology and AI, according to Westminster City Council.
In July, the council launched a public engagement exercise asking more than 200,000 residents to share their budget priorities. The responses are intended to inform decisions about the 2027/28 budget, allowing the authority to understand which services residents value most as it navigates further reductions. Fisher acknowledged that there would be further significant savings ahead, describing the current restructure as an "important step" in a longer process of financial adjustment.
What will happen to council tax?
The council has indicated that the new budget will necessitate inevitable council tax increases for 2027/28. No decision about the new rate has been made yet. However, sources previously indicated that Westminster might need to raise council tax by 75% to 100% in the coming year to address the funding gap, though this remains subject to formal consultation and approval.
The government has given Westminster special permission to raise council tax above the usual 5% limit next year, providing some flexibility in how the authority responds to the funding reduction. This power to exceed the normal cap has also been extended to some other boroughs losing funding, though it remains a contentious issue. The council tax increase, when announced, will be a significant burden on residents already facing broader cost-of-living pressures.
What happens next?
A formal consultation on the redundancies is planned, with affected staff expected to leave the organisation between April and December 2027. The council will use residents' feedback from its public engagement exercise to inform its 2027/28 budget decisions, potentially shaping which services are prioritised and which face further reductions.
The savings announced on Tuesday represent only a portion of the total shortfall Westminster faces by 2029. More cuts to council services are likely before the final budget is set in spring 2027, and the authority continues to explore additional efficiency measures and commercial opportunities to bridge the widening gap between its funding and its obligations.
