London Councils has called for a 'significant reform' of the funding system for local authorities following the publication of the local government settlement for 2023-24.

MPs are set to discuss the settlement on Wednesday (8 February) in parliament and whilst London Councils has welcomed the uplift in funding for boroughs, the cross-party group has expressed concern in the ways cash will be sourced.

A third of the total funding increase available for councils depends on boroughs raising council tax to the maximum permitted level.

Council tax bills in Kingston are the most expensive across the 32 London boroughs and the Liberal Democrat-run authority has published plans for an increase of £85.30 at the benchmark Band D level within their budget for 2023-24.

When the Mayor's rise in the precept of £38.55 is added, this would add £123.85 to average billis in the borough - taking Band D bills to £2,246.71.

Kingston council has said it is facing rising demands on services, increasingly complex needs and pressures from the cost of living crisis – adding to ongoing challenges from the Covid-19 pandemic and Brexit. A fresh report says the budget proposals aim to help the authority meet "significant challenges" while ensuring services for residents and supporting those most in need.

The authority's reserves stand at £19.6m, with no increase proposed, but an overspend in 2022/23 is forecast. The report says an overspend and shortfall of funding for activities covered by the dedicated schools grant, for children with special educational needs (SEND), will lead to a cumulative deficit of £8m by March 31.

London Councils argues that boroughs need long-term funding assurance to maximise their impact across a range of policy priorities shared with the government such as tackling poverty and homelessness, addressing pressures in adult and children's social care, speeding up the net zero transition, and encouraging economic growth in all communities.

The group has expressed its desire to work with ministers on exploring new policy solutions for sustaining local government finances and enabling boroughs to respond to their residents' needs as effectively as possible.

Cllr Georgia Gould, Chair of London Councils, said: "Boroughs play a vital role in supporting Londoners through the cost-of-living crisis, but for too long have been hampered by inadequate funding and a lack of long-term planning from central government. The entire system needs urgent reform.

"London faces a wide range of major challenges. Giving boroughs better funding tools is essential for investing in local services and enabling us to make faster progress in reducing poverty, driving inclusive economic growth, tackling climate change, and supporting Londoners' other key priorities."