London Daily

Focus on the big picture.
Tuesday, Mar 03, 2026

UK government to allow councils to sever Russian contracts

UK government to allow councils to sever Russian contracts

Councils pushing to break ties had been prohibited from taking ‘non-commercial considerations’ into account

The UK government introduced legislation on Thursday to help councils, NHS trusts and other public bodies exit contracts with Gazprom and other Russian companies

Councils have been keen to withdraw from contracts amid concerns they were helping to fund Vladimir Putin’s regime. They had been prohibited from taking “non-commercial considerations” into account when procuring or terminating contracts, and they have a statutory duty to find the cheapest deal on behalf of the taxpayer.

Many councils had been forced to select Gazprom as a supplier because it offered the greatest value for money. They paid £29m to Gazprom from 2016 to 2021, data firm Tussell has said.

In March, the Cabinet Office asked central government to review all contracts with Russia and Belarus-linked firms and to consider terminating those contracts. This process has now been extended to local councils.

Councils including Merton and Telford and Wrekin have said they are keen to cut ties with Russia.

A government source said: “Local authorities are not obliged to terminate contracts, but our message is clear: Putin’s barbaric regime should not benefit from taxpayers’ money.”

The communities secretary, Michael Gove, will now write to all councils to make them aware of the changes.

The government has said any costs incurred from exiting contracts will have to be covered by existing budgets.

The west is attempting to choke off the Russian economy to damage Putin’s war coffers and fuel anti-war sentiment among the Russian public.

A Department for Levelling Up, Housing and Communities spokesperson said: “Businesses with links to Putin’s murderous regime should not benefit from taxpayers’ money.

“These measures will allow councils to terminate existing contracts – ensuring public money does not fund these organisations or Putin’s barbaric war machine.”

Research for the Guardian and Tussell shows that councils and NHS trusts have paid nearly £5m to Russian firms including Gazprom since the invasion of Ukraine under existing contracts.

NHS trusts – including Manchester University NHS foundation trust and the Southport & Ormskirk hospital NHS trust – have paid £3.2m. Councils including Portsmouth and Buckinghamshire have paid £1.6m.

Separately, a Treasury deadline to halt payments to Gazprombank and its subsidiaries for gas going from the UK to European Union countries is fast approaching. An original deadline of 21 April to halt payments was extended to 31 May last month. Many large Gazprom gas contract holders are based in the UK and help supply gas to the EU, which imports about 40% of its gas from Russia.

Gazprom’s UK arm is the largest non-UK supplier of gas to businesses and public bodies. Its market share was 22% before the invasion of Ukraine and it supplied gas to 178,000 sites, with contracts worth approximately £4bn, according to Capital Monitor estimates.

Newsletter

Related Articles

0:00
0:00
Close
UK Arrests Prominent Figures Linked to Epstein Network as Questions Mount Over US Action
Trump Says UK ‘Took Far Too Long’ to Approve Use of Airbases for Iran Strikes
Scope of Britain’s Role in the Expanding Middle East Conflict Comes Under Scrutiny
Trump Says He Is ‘Very Disappointed’ in Starmer Over Iran Comments
U.S. Embassy in Riyadh Struck by Drones Amid Escalating Iran Conflict
Starmer Confronts Strategic Test After Drone Strike Near British Base in Cyprus
Rolls-Royce Chief Signals Openness to Germany Joining UK-Led Fighter Jet Programme
UK Stocks Slip as Escalating Iran Conflict Triggers Global Market Selloff
UK Overhauls Asylum System to Make Refugee Status Temporary
Starmer Warns of ‘Reckless’ Iranian Strikes Amid Escalating Regional Tensions
British Base in Cyprus Targeted as Drones Intercepted Amid Expanding Iran Conflict
Starmer Diverges from Trump on Iran Strategy, Rejects ‘Regime Change from the Skies’
U.S. and Israel Intensify Strikes on Iran as Conflict Expands to Lebanon and Gulf States
Violent Pro-Iranian Protesters Storm U.S. Consulate in Karachi
Missile Debris Sparks Fires at Dubai’s Jebel Ali Port Near Palm Jumeirah
Iran Strikes U.S. Fifth Fleet Headquarters in Bahrain Amid Wider Gulf Retaliation
When the State Replaces the Parent: How Gender Policy Is Redefining Custody and Coercion
Bill Clinton Denies Knowing Woman in Hot Tub Photo During Closed-Door Epstein Deposition
Former U.S. President Bill Clinton Testifies on Ties to Jeffrey Epstein Before Congressional Oversight Committee
Dyson Reaches Settlement in Landmark UK Forced Labour Case
Barclays and Jefferies Shares Fall After UK Mortgage Lender Collapse Rekindles Credit Market Concerns
Play Exploring Donald Trump’s Rise to Power by ‘Lehman Trilogy’ Author to Premiere in the UK
Man Arrested After Churchill Statue Defaced in Central London
Keir Starmer Faces Political Setback as Labour Finishes Third in High-Profile By-Election
UK Assisted Dying Bill Set to Fall Short in Parliament as Regional Initiatives Gain Ground
UK Defence Ministry Clarifies Position After Reports of Imminent Helicopter Contract
Independent Left-Wing Plumber Secures Shock Victory as Greens Surge in UK By-Election
Reform UK Refers Alleged ‘Family Voting’ Incidents in By-Election to Police
United Kingdom Temporarily Withdraws Embassy Staff from Iran Amid Heightened Regional Tensions
UK Government Reaches Framework Agreement on Release of Mandelson Vetting Files
UK Police Contracts With Israeli Surveillance Firms Spark Debate Over Ethics and Oversight
United Airlines Passenger Hears Cockpit Conversations After Accessing In-Flight Audio Channel
Spain to Conduct Border Checks on Gibraltar Arrivals Under New Post-Brexit Framework
Engie Shares Jump After $14 Billion Agreement to Acquire UK Power Grid Assets
BNP Paribas Overtakes Goldman Sachs in UK Investment Banking League Tables
Geothermal Project to Power Ten Thousand Homes Marks UK Renewable Energy Milestone
UK Visa Grants Drop Nineteen Percent in 2025 as Migration Controls Tighten
Barclays and Jefferies Among Banks Exposed to Collapse of UK Mortgage Lender MFS
UK Asylum Applications Edge Down in 2025 Despite Rise in Small Boat Crossings
Jefferies Reports Significant Exposure After Collapse of UK Lender MFS
FTSE 100 Reaches Fresh Record Highs as Major Share Buybacks and Earnings Lift London Stocks
So, what's happened is, I think, government policy, not just under Labour, but under the Conservatives as well, has driven a lot of small landlords out of business.
Larry Summers, the former U.S. Treasury Secretary, is resigning from Harvard University as fallout continues over his ties to Jeffrey Epstein.
U.S. stocks ended higher on Wednesday, with the Dow gaining about six-tenths of a percent, the S&P 500 adding eight-tenths of a percent, and the tech-heavy Nasdaq climbing roughly one-and-a-quarter percent.
From fears of AI-fuelled unemployment to Big Tech's record investment, this is AI Weekly.
Apple just dropped iOS 26.4.
US Lawmakers Seek Briefing from UK Over Reported Encryption Order Directed at Apple
UK Business Secretary Calls on EU to Remove Trade Barriers Hindering Growth
Legal Pathways for Removing Prince Andrew from Britain’s Line of Succession Examined
PM Netanyahu welcome India PM Narendra Modi to Israel
×