Tuesday, 23 February 2010

Sun Hill budget 2010 / 2011

Sun Hill is the fictional suburb that features in TV series 'The Bill'. It is within the fictional London Borough of Canley. We're not told the population, but London boroughs typically have a population of around a quarter of a million; if there were, say, ten neighbourhood areas within this each with a population of 25,000 this wouldn't be too far away. The cast is quite small; a Superintendant, a DI, an Inspector, two detective and two uniformed sergeants and six uniformed plods.

Our fictional Sun Hill is based on the small town of Vail in Colorado. Vail's police force has 31 officers and 32 support personnel and is run by the town council and paid for locally, and so does our fictional Sun Hill.

Our Sun Hill also runs its own Fire Brigade, parking, local buses, library, refuse collection, streets and public works, parks, determines its own planning and development policy and develops affordable housing for key workers. In fact, Sun Hill does everything we think of councils doing except highways major routes and education, which are managed at borough level (county level in the US). Here's where the money will come from in 2010/2011:

INCOME
VAT - 4% VAT rate funds about 35% of Sun Hill's expenditure. The suburb levies local VAT, at a total rate of 8%. The balance of 4% is passed over to Canley Borough and the Mayor of London for education, major road routes and other services.
STAMP DUTY - A 1% flat rate Stamp Duty on all property transfers within Sun Hill. This funds 9% of the annual budget
COUNCIL TAX - A property tax that funds 11% of Sun Hill's budget. Sun Hill gets 10% of the total Council Tax take, the remainder going to Canley Borough for education and other services
UTILITIES TAX - Sun Hill levies a franchise fee on all utility companies operating in the area. Currently Thames Water, EDF, British Gas, BT and Virgin cable provide the bulk of the 8% of Sun Hill's budget that this produces
LICENCES AND PERMITS - Income from planning and building control fees, alcohol sales and other licensing, skip permits. Provides 2% of the annual budget.
PARKING - Income from car parks and permits and charges for on-street parking provides 12% of Sun Hill's budget
FINES, RENTAL INCOME & MISC - Fines, rents for council-owned properties including affordable housing and business premises and interest on balances and investments. Provides about 8% of annual income.
TRANSFERS - 10% of the annual budget comes back from Borough and London taxes including fuel duty, tobacco duty and vehicle excise duty
MISC - The balance of 5% is made up of charges for services to the public and other councils and minor income sources.

Those of you who have read the Lyons Report into local government funding must be thinking that the little town of Vail, which collects and administers the taxes and duties above, must be run by a race of superhumans; Lyons, after all, declared it was utterly impossible for small councils to collect taxes efficiently. The Treasury was absolutely certain in its evidence to Lyons that taxes could only ever be efficiently collected at a national level. Well, either the people running Vail are extraordinary or the Treasury and Lyons are wrong, and since there are 10,000 Vails all doing the same across the US, it doesn't take much nous to conclude that the Treasury is utterly mistaken in its advice to Lyons.

You'll also notice that our Sun Hill gets not a penny from income taxes, including NI, or corporation taxes. In our scenario, these are collected nationally and fund national goods - defence and the the legal system, with a proportion granted on to borough level to fund Welfare and the NHS, both functions administered at the level of our present unitary councils along with education.

You see, there are alternative ways of doing things; it's easy to be so hypnotised by the baleful weight of the Leviathan central State that the alternatives are hidden. But which of the three main parties will change London into a city of 330 Sun Hills?

2 comments:

Demetrius said...

When I were a lad there were plenty of small authorities around with a wide range of functions. Even some of the big education authorities broke down into local districts. It all seemed to work and with many fewer people. Then it all changed.

Weekend Yachtsman said...

Demetrius, it was the Iron Law what done it:

http://www.jerrypournelle.com/archives2/archives2mail/mail408.html#Iron

Or call it Parkinson, if you prefer.

That and the relentless centralism of the Leviathan State.