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Wednesday, May 25, 2005
Financing local services

Peter Webb, Chairman of the Surrey Tax Action Group - an Alliance Member of the TPA - has written to the Daily Telegraph today responding to their leader which argues that "locally run services should as far as possible be locally financed." This is what Peter thinks:

SIR - Today in your leading article you say that locally run services should as far as possible be locally financed. They already are. But with centrally driven prescription we don't know who runs what local services, and 'local' and other taxes are recycled between areas by grant and between people in benefits before being put to work. Tax is not a price for local services and does not measure anything for accountability. 'Local' tax is as much a lie as is 'national insurance fund' (there isn't one).

To separate tax raising from tax distribution would allow great reform for simplicity, transparency and national well-being. The Lib Dem Party is to be congratulated for its vision, and action to investigate flat tax.

Any devolved operation should be able to tap into centrally banked tax. After all Local Authorities are now required by law to conduct the full panoply of corporate planning and associated disciplines. This unavoidably renders the budgets as better than centrally imposed grants as the measure of revenue required.

I have been able personally to give Sir Michael Lyons, leading the Lyons inquiry set up to prescribe for an improved council tax, a simple non-bureaucratic scheme for accessing revenue which does not conflict with national strategy and fiscal responsibility. And it is possible on one sheet of paper, or personal tax statement, to show the national accounts and the link to local spending, an objective which some experts have turned somersaults to try and achieve at great cost and complexity with local income tax design.

Peter Webb

Chairman, STAG

Posted by Matthew Elliott | Permanent Link

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