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I believe primary legislation was passed to allow the Congestion Charge. So councils weren’t part of that decision.
That’s correct--the main powers were given by the GLA Act 1999 and the Transport Act 2000.
It's a very old policy idea, dating back to the 60s at least, and Livingstone always wanted to do it when he was at the GLC. Needless to say, with a Thatcher government there wasn't a chance to get it into law, and it only did become law in 1999/2000 (one thing to realise about all these policies is that they can take decades to mature), which in a sense was much too late--and as it was always flawed (the charge too low, not tied to some kind of progressive index like inflation, implemented using technology that soon became outdated, etc.), it was never a very powerful tool to really reduce levels of motor traffic sustainably beyond its initial impact. The fact that London grew so much during that period obviously didn’t help, but this was undoubtedly also partly caused by increasing global perception of London as a more liveable city, which in turn was certainly caused by Congestion Charging.
I believe primary legislation was passed to allow the Congestion Charge. So councils weren’t part of that decision.