London Mayor Sadiq Khan takes 10% pay cut amid austerity warning

17 June 2020, 19:29

Mayor of London Sadiq Khan has slashed his pay by £15,300
Mayor of London Sadiq Khan has slashed his pay by £15,300. Picture: PA
Nick Hardinges

By Nick Hardinges

Mayor of London Sadiq Khan has taken a 10 per cent pay cut amid an austerity warning following the coronavirus pandemic.

The Labour mayor called on Prime Minister Boris Johnson to bail out local authorities that face the prospect of a funding black hole as a result of the Covid-19 outbreak.

Mr Khan, who will see £15,300 slashed from his current £152,734-per-year salary, warned that councils are looking at shortfalls in business rate and council tax income following the pandemic.

Cuts in the capital could be made to the Metropolitan Police, London Fire Brigade, Transport for London and the Greater London Authority due to a £500 million funding shortfall.

Senior appointments to City Hall will also see their pay frozen to help combat the issue.

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Speaking on Wednesday, Mr Khan said: "Londoners did the right thing to tackle Covid-19 by following the rules, staying at home and helping to save lives. But now the government is punishing them with a new era of austerity.

"Covid-19 has had a devastating impact on London's public finances, which were in great shape before the pandemic.

"TfL's fares income has dropped by more than 90 per cent and local business rates and council tax income has fallen off a cliff.

"This is the worst possible time for a return to austerity - just when we need to invest in London's recovery.

"Unless ministers act, the current number of police officers will need to be reduced and it will be impossible to tackle youth violence or make the changes to the London Fire Brigade that are desperately needed after the awful Grenfell Tower tragedy."

The shortfall in tax receipts is due to a forecast reduction in the number of firms paying business rates and householders not able to keep up with council tax bills.

The London Mayor called on ministers to act on Mr Johnson's promise that he would not return to austerity measures to balance the books as a result of the coronavirus crisis.

He warned that failure to act would jeopardise the prime minister's commitment to recruit 20,000 extra police officers during his term in government.

Mr Khan said: "I didn't enter politics to administer government austerity, and I will do everything in my power to persuade ministers not to force another era of austerity on local and regional government.

"Whatever happens, I will protect the frontline services that Londoners depend on as much as possible - and it's only right that I should volunteer for an immediate pay cut in these extremely difficult circumstances and continue not to take any pension contributions.

"In addition, I have taken the decision to freeze the salaries of my political appointments at City Hall."

Mr Khan will publish new budget guidance, which will outline the request for the GLA, TfL, Scotland Yard, London Fire Brigade, the London Legacy Development Corporation, Old Oak and Park Royal Development Corporation to report back by the end of November on how they could deliver significant savings.

With London elections due next year, and the added complication of Mr Johnson being a former mayor, the capital's finances risk becoming a political football.

TfL has already received a £1.6 billion bailout as a result of the impact of coronavirus and Tory mayoral candidate Shaun Bailey has accused Mr Khan of "bad management".

A government spokesman said: "We have given London an unprecedented package of support to ensure they have the resources they need to provide services for their communities during the pandemic.

"The GLA has received an extra £18.5 million of emergency funding and an additional £1.6 billion for Transport for London.

"This is on top of an increase in core spending power of over £88 million to over £2.27 billion, while the Metropolitan Police is receiving £2.9 billion in funding this financial year, the most substantial police funding increase since 2010.

"We have given London councils £518 million in additional emergency funding as part of a total of over £5.3 billion of government support for communities and businesses across the city during the pandemic.

"We are working on a comprehensive plan to ensure councils' financial sustainability over the year ahead and we will update as soon as we are able."

Labour leader Sir Keir Starmer hailed Mr Khan for highlighting the pandemic's financial burden on councils but appeared to have no plans to follow him in taking a pay cut.

Asked if he would slash his salary, the Labour leader's spokesman said: "Sadiq is the Mayor of London, he's overseeing the Greater London Authority which is going to have a deep financial black hole because of the consequences of the pandemic and it is right that Sadiq is speaking up for London and speaking up for those concerns."