The Conservative council responsible for the tower block where at least 79 people died in a fire described by the mayor of London as preventable has stockpiled £274m of reserves and offered rebates to residents paying the top rate of council tax.



According to the latest accounts, the Royal Borough of Kensington and Chelsea ran a budget surplus, which Labour councillors have claimed was being used as a slush fund to bribe voters with a rebate close to elections.

A draft statement of Kensington and Chelsea’s accounts for 2016-17 disclosed that the council has an “AA” credit rating and a financial standing described as robust, with “usable reserves at 31 March 2017 of £274m (£300m at 31 March 2016)”.

The council has been relieved of responsibility for taking care of the survivors of the disaster, having struggled to cope with the aftermath of the deadly blaze. A new Grenfell fire response team, made up of representatives from central government, the British Red Cross, the Metropolitan police, London-wide local and regional government and the London fire brigade, will now coordinate efforts.

In 2014, the council decided to hand back £100 to residents paying the top rate of council tax in 2014 after a claimed “overachieving efficiency drive”, a decision criticised in a letter to the Guardian following the high-rise fire.

The rebate was paid weeks before local elections which returned a Conservative council, the author of the letter wrote. “Austerity, K&C style: you give to the rich while taking from the poor (nobody with discounted bills or claiming council tax support was eligible to share in the bounty of the town hall blue-chips).

“As the toxic ash of Grenfell Tower’s vanity cladding falls over the neighbouring streets, we are left with the acrid truth in our throats: regeneration in the Royal Borough is in fact a crime of greed and selfishness,” the author wrote.



Labour councillors have said the refund was a form of bribe handed to wealthy voters just before the local elections. Robert Atkinson, leader of the council’s Labour group, told a budget meeting this year that the Tories were “bribing the electorate with its own money” after the council “systematically and deliberately created underspends”.

Before the fire, residents of the tower block had protested about cuts to the housing budget. In 2015, the council paid £5m from its reserves to help establish Opera Holland Park, formerly a department of the Kensington and Chelsea, as an independent charity.

Last year, housing officials in the borough took about £55m in rent, but invested less than £40m back in council housing.



Downing Street on Monday refused to say whether Theresa May had “full confidence” in the leadership of the council.

“The prime minister’s work has been to make sure that the people on the ground get the support they need,” said a spokesperson. “All of the councils are working together and that’s what happening.”



Gold command, the emergency services network in place to manage disasters, was brought in “because the prime minister has understood that what has happened over the first few days wasn’t good enough”, the spokesperson added.

The council’s leader, Nick Paget-Brown, was asked by BBC Radio 4’s The World at One whether he felt guilty about the loss of life. He said: “I feel terrible about the whole position we find ourselves in … There is an effective, coordinated relief effort on the ground and I’m sorry if people haven’t seen that.”

A council spokesman said all matters regarding the fire would be subject to formal investigations.

“Our staff continue to work tirelessly to support the London-wide efforts to help those affected by the fire. The council’s reserves support a substantial programme of capital investment – including improvements to primary schools and a new library – details of which are on the council’s website,” he said.