The dreaded Council Tax bill arrives!

Our Council tax for 2007/8 has arrived and is a whopping £1,200.05. How is that money justified?

Well, let us delve more deeply into the numbers. First of all, our house is classed as a Band D, which is sort of ordinary. The bands are based on how much the house was worth in 1991, fifteen years ago. Now putting aside how realistic or fair it is to base the value of your house on what you contribute to local taxes (rather than what local services you consume) it does give a profile of people paying different amounts. For Leeds, the ratio is roughly as follows:

A 40.25%
B 20.65%
C 19.1%
D 9.2%
E 5.8%
F 2.8%
G 2.0%
H 0.2%

Now these households pay a ratio of the Band D amount in ninths, as follows:

A - 6/9
B - 7/9
C - 8/9
E - 11/9
F - 13/9
G - 15/9
H - 18/9

There is also a hidden bottom band which used to be called band W but is now referred to as Band A (5/9) where a disabilities discount is granted.

So for a £1,200 bill, the Band A's pay £800 and the Band H's pay £2,400. (Of course there are discounts and benefits to ease the bill for the needy).



So now you know.

The Leeds City Council amount is £1,182.20 and on top of that we pay £17.85 to Morley Town council. (Other Bands follow the ninths formula.)

The Leeds sum includes two specific precepts- for policing (£118.02) and Fire & Rescue (£48.02) so Leeds get to keep £1,016.16.

Expressing it weekly, we pay as follows:

Leeds £19.54
Police £2.27
Fire £0.92
MTC £0.34
=============
TOTAL £23.07

It doesn't sound too much when expressed that way. However, it is grossly misleading as local taxes only make up a small amount of Local Council revenue- most of it comes from Central Government through a series of complex, arcane and readily manipulative (by the government) formulae. This is why larger than inflation increases in local tax don't have the same beneficial effect in Council budgets- the pips are getting squeezed by the men from the Ministry.

This is summarised by Leeds as follows:

Where does the money come from?
Service Specific Government Grants 46%
Fees and charges 14%
Council Tax 13%
Business Rates 13%
Rents 9%
General Government Grant 2%
Other 3%

Where does the money go?
Employees 49%
Supplies and transport 30%
Payment of benefits etc 12%
Paying debt and interest 5%
Premises 4%

These are the actual services:


Let us put this into big numbers context. What is the overall budget of the Council?

£1,848,400,000 (to the nearest hundred thousand pounds).

That is a Gosh number. Nearly TWO BILLION POUNDS, nearly half of which goes on salaries for the 35,000 employees. It makes you think...