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Labour's £78 Billion Plan Sparks Tax Controversy

12/17/2025

Summary

Story summary

Communities Secretary Steve Reed announced a £78 billion funding settlement that allows some councils to exceed the 5% council tax cap starting in 2027.
The plan aims to restore services lost under the previous Conservative governance and guarantees financial protection for councils during the transition.
Critics, including Shadow Local Government Secretary Sir James Cleverly, say the Labour government is raising taxes and redistributing funds from low-tax councils to poorly managed ones.

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Story summary

Communities Secretary Steve Reed announced a £78 billion funding settlement that allows some councils to exceed the 5% council tax cap starting in 2027.
The plan aims to restore services lost under the previous Conservative governance and guarantees financial protection for councils during the transition.
Critics, including Shadow Local Government Secretary Sir James Cleverly, say the Labour government is raising taxes and redistributing funds from low-tax councils to poorly managed ones.