Ahead of next week's Budget, Westminster Conservatives' Group Leader Cllr Paul Swaddle has today written to the Chancellor, Ms Rachel Reeves. Paul made a series of proposals of particular concern to people living and working in Westminster.
Protecting Councils from potential cuts:
There has been unwelcome speculation in the FT that Councils will be targeted with spending cuts- we have campaigned ferociously that Councils should not have the rug pulled from under their feet as they provide vital front-line services.
We have also called for a longer three-year financial settlement to help Councils secure their future and stave off Section 114s, which will help them plan accordingly and improve efficiency.
Support of businesses:
Request for the reintroduction of VAT-free shopping for overseas visitors. The current “tourist tax” is responsible for nearly £600 million in unrealised sales since 2023.
Request for the continuation of the business rate relief received by the hospitality sector, which is due to end in March 2025. Expiration could cost the industry almost £1 billion.
Maintaining the single-person discount on council tax
There are nearly 43,000 single people in receipt of the single person council tax discount in Westminster. If this is removed, it will cost them an average of £530.
Replacing the Pimlico District Heating Undertaking (PDHU)
PDHU supplies heat to over 3,000 homes, scores of commercial premises, several schools across Pimlico. It is the oldest district heating system in the UK and the current pipework is reaching the end of its life and it requires replacement. We have urged the Chancellor to upgrade the public electricity grid system to ensure people only pay for the energy they use.
Adult Social Care
At the most recent Budget at Westminster City Council, our group highlighted the spiralling costs spent on agency staff who mainly assist with adult social care- which has amounted to almost £15 million over the past two years. Central Government must implement a long-term, fully funded workforce strategy to tackle this issue, and we have asked the Chancellor to use this budget to secure the future for adult social care which will benefit patients.
Education and SEND pupils
In Westminster, there are scores of pupils with SEND needs who have places funded by the local authority, but there are also a sizable number of SEND pupils who do not have an ECHP who will have to pay an additional 20% on their fees due to the removal of VAT on independent schools. This would result in many students needing more assistance from within the state sector after they are forced to move across because of these costs, so we have campaigned for the Chancellor drop this damaging proposal.
Saving St Mary’s Hospital in Paddington
The new Government must end the stalling review which is causing great distress for hospital workers and patients alike. The previous Conservative Government was committed to the complete rebuilding of St Mary's with the release of money for planning and design works in the final stage of being approved and we have lobbied the Chancellor to secure the future of a hospital fit for the 21st century.
Read the letter in full
Read Paul's letter below and let us know whether you agree with his proposals by clicking here.
Dear Ms Reeves,
I am writing to you on behalf of the Westminster City Council Conservative Group ahead of the Autumn Budget next week to outline measures that would support the people living across Westminster and boost businesses that play an integral part to our economy locally and nationally.
Firstly, Local Government should be protected from any potential cuts due to the vital front-line services they provide so we urge you to dispel the unfortunate and unsettling rumours which were featured in the Financial Times[1] recently.
A quarter of councils in England have said that they are likely to have to apply for emergency government bailout agreements and be forced into Section 114 emergency measures to stave off bankruptcy in the next two financial years according to the Local Government Association (LGA).
A positive step would be to provide councils with a 3-year financial settlement so they can plan accordingly with certainty, which will in turn lead to greater efficiencies and savings. We strongly encourage you to consider this and all the other encompassing proposals as outlined in this letter, and of course we are more than happy to discuss this further with you should you so wish.
Businesses
As you are aware, iconic streets within Westminster such as Oxford Street and Regent Street are magnets for trade generated by visitors from both the UK and from across the world, however their full potential is currently being held back.
We therefore urge you to reintroduce VAT-free shopping for overseas visitors in your upcoming Budget. According to the New West End Company, which represents hundreds of businesses and retailers, this “tourist tax” was responsible for almost £250 million-worth in unrealised sales this year, adding to circa £400 million-worth in missed sales last year.
Furthermore, in response to the Government’s answer to a Written Question last month (UIN 4360), the hospitality industry is also concerned about the uncertain future of business rate relief that they receive. The hospitality industry is already facing challenges caused by licensing restrictions and we deeply regret the Mayor of London and his previous Night Czar’s ineffectiveness in alleviating their predicament.
Their business rate relief is due to end at the end of March 2025, and industry leaders have warned that without any action this could cost the industry close to £1 billion, which would be a devastating blow most acutely felt in the heart of London especially in Westminster.
Whilst we recognise that cancelling the tourist tax and continuing rate relief for the hospitality industry may cause an initial dent in the Treasury’s revenues, this will be dwarfed by the longer-term return of confidence to businesses and consumers, which will align with the Government’s stated goals as set out at the recent Investment Summit and lead to increases in the Government’s tax revenues in the long-term.
Council tax - Single person discount
We do welcome that Treasury officials indicated earlier this month that that single-person Council Tax discount will not be scrapped, however we strongly request that it is not tampered or amended in any way as it will not, as set out in a recent House of Commons briefing paper analysing this issue [2], generate any additional revenue for councils.
According to the Taxpayers' Alliance, if this tax was scrapped this would lead to “[an] average increase for a single person household living in a Band D property [paying an additional] £530” [3]. This would be acutely felt for single people in Westminster as it has one of the highest number of properties which fall under this bracket in the UK [4] and there are nearly 43,000 single people in receipt of the single person Council Tax discount in Westminster.
Energy Infrastructure
Another area of concern where you can be of assistance to the people of Westminster relates to the Pimlico District Heating Undertaking (PDHU). PDHU supplies heat to over 3,000 homes, scores of commercial premises, several schools and a post office. It is owned and managed by Westminster City Council and is the oldest district heating system in the UK. Its pipework is reaching the end of its life [5].
As the buildings are listed, and due to the cost of a replacement pipework, an electrical solution where people are only charged for the energy they use should be implemented. However, this is presently not possible as the public electricity grid system does not have the capacity to cope with the increased electrification pressures resulting from the decommissioning of the PDHU network.
Therefore, we urge you to release the necessary funds to the Ministry of Housing, Communities and Local Government to distribute to Westminster City Council to upgrade the public electricity grid system to tackle this long-overdue problem to secure the future for the thousands of people in Pimlico who are awaiting the replacement of the PDHU network.
Adult Social Care
At the most recent Budget Council at Westminster, our group highlighted the spiralling costs spent on agency staff who mainly assist with adult social care which has amounted to almost £15 million over the past two years [6]. We share the Local Government Association’s views [7] that central Government should implement a long-term, fully funded workforce strategy for adult social care and your first Budget is the ideal opportunity to realise this ambition.
This long-term solution will save the taxpayer considerable costs and enable the enhanced recruitment and retention of staff in stable employment which will also help the people they look after because the care recipients will feel more confident in the consistency of care that they receive.
Education and SEND pupils
Looking towards the next generation, it is of huge regret that the Government are intending to impose VAT on independent school fees which will have a detrimental impact for pupils, parents and the schools themselves. Westminster has several top-class independent schools including Westminster School and Francis Holland which will be negatively affected by this illogical and ideological decision.
You will be familiar with the evidence that demonstrates that this plan is counterproductive as parents who cannot afford the 20% increase will move their children across to the state sector exacerbating the existing pressures on schools and cause significant upheaval for everyone [8].
In Westminster, there are nearly 100 pupils with SEND needs who have places funded by the local authority but, as you are aware, there are a sizable number of SEND pupils who do not have an ECHP who will have to pay an additional 20% on their fees snd this would result in these students needing more assistance in the state sector. Their families will therefore feel the need to apply for an EHCP to escape this charge. This would overwhelm Children’s Services at Westminster City Council, who already have almost 1500 children on EHCPs.
This sudden imposition of VAT on independent schools is disproportionate and unfair; however, it is not too late to do the right thing and drop this damaging proposal.
The National Health Service- Hospitals
Finally, we would like to bring to your attention to the plight of St. Mary’s Hospital in Paddington, parts of which date back to the early Victorian era. Professor Tim Orchard, Chief Executive at Imperial College Healthcare NHS Trust, highlighted the urgent need for a new hospital in Paddington[9] , and we have similarly campaigned for the Government to unlock the funding to enable this to take place.
I recently met with Victoria Atkins MP, former Secretary of State for Health, at the hospital. The previous Government was committed to the complete rebuilding of St. Mary's and the project had the full support of Ms Atkins as the Conservative Secretary of State, with the release of money for planning and design works in the final stage of being approved.
Therefore, the new Government must end the review which is causing great distress for hospital workers and patients alike and secure the future of a hospital fit for the 21st century.
Conclusion
We understand the competing requests you will have to consider ahead of your first Budget, however prioritising local government sector finances will secure key services and result in a return on investment to the taxpayer, which will make a positive impact for the people and businesses of Westminster.
We eagerly await your response.
Yours sincerely,
Cllr Paul Swaddle
[1] https://www.ft.com/content/954d33a0-6291-4dbb-96c6-f19bc93959f2
[2] https://commonslibrary.parliament.uk/what-would-happen-if-the-single-person-discount-on-council-tax-was-abolished/
[3] https://www.taxpayersalliance.com/briefing_single_person_household_council_tax_discount
[4] https://www.gov.uk/government/publications/council-tax-number-of-properties-by-council-tax-band-and-westminster-parliamentary-constituency-post-2024-general-election-2015-to-2024
[5] https://www.westminster.gov.uk/housing/pdhu
[6] https://committees.westminster.gov.uk/ieListDocuments.aspx?CId=175&MId=6137
[7] https://www.local.gov.uk/about/news/councils-call-immediate-action-adult-social-care-workforce
