Thursday 19 April 2012

BORIS JOHNSON V KEN LIVINGSTONE: WHO IS RIGHT ABOUT COUNCIL TAX SAVINGS?


First Published By: The Guardian


Boris Johnson claims to be putting back £445 into Londoners pockets.


How: By freezing the part of Council Tax controlled by the mayor. Is this right? Rivals Boris Johnson and Ken Livingstone have had bitter exchanges in their debates so far to win votes of Londoners.

The incumbent London mayor has made freezing the part of Council Tax controlled by the mayor's office (the precept) one of his nine promises to Londoners. Ken Livingstone is promising the same. But is Johnson right to claim this will mean £445 in Londoner's pockets?

The claim
Putting £445 back in your pocket by freezing the mayoral share of the Council TaOn Johnson's website he explains this promise: Boris Johnson's Council Tax freezes over three successive years have saved the average London household up to £445.

Under Boris Johnson, Council Tax has been frozen three years in a row and cut by 1% for the fourth year. Whereas: under Ken Livingstone, the mayor's Council Tax precept increased by an average of 12.58% a year. In total, he put it up 152% which cost the average London household £964. Assuming a base figure of £310, households have therefore saved £445 under Boris Johnson. Overall, this means a 16% real terms cut over four years.

A spokesman for the campaign adds:
Ken's record in office was to increase Council Tax by 152%. That's average annual increases of 13%. This cost average band d households £964. That's his record in office. That's what he's shown himself to do. Boris Johnson got in and cut waste at City Hall freeing that money up for services. He's been able to freeze Council Tax for three years and cut it year. This is 16% cut in real terms. 

If Ken Livingstone had got back in his record shows that Council Tax would have continued to rise and at that rate it would have gone up over that period. Difference is £445 over the four-year term. Labour points out that the title of this promise (Putting £445 back in your pocket by freezing the mayoral share of the Council Tax) sounds like they are promising something new to voters, whereas in fact they are simply making claims about their record. It's included in a section called "my nine-point plan for London", which does make it sound like a future promise.

In a statement Livingstone's campaign said:
According to his own budget, his cut this year to the Council Tax will save households £3.10 per year. His pledge for the Council Tax is the same as ours – to freeze it for four years. There's another problem with Johnson's promise. Is it really fair or accurate to assume what Livingstone would have done had he won the last mayoral election and to then calculate the difference?

I asked spokesman for Johnson's campaign who said:
There is no reason to think otherwise as that was his record in office. There is one reason. Since 2010 the coalition has paid for a Council Tax freeze for local government, meaning for the last year at least, it is extremely likely that there would have been no increase in the part of Council Tax controlled by the London mayor.

Verdict
Both candidates are promising to freeze Council Tax if they win this election. Johnson's website gives a confusing impression claiming that a Council Tax freeze would save Londoners £445 over a term. While he is promising to freeze the part of Council Tax that the mayor controls, those are savings he claims Londoners have already enjoyed during his current term in office.

Those savings are also made on assumptions based on Livingstone's previous record in office. There is no proof that Livingstone would have increased Council Tax by as much as the Johnson campaign claims and indeed a central government Council Tax freeze suggests that it's highly unlikely that he would have for one of the years.

Johnson is right that in the past year he has cut Council Tax but the savings to Londoners won't go very far. It amounted to £3.10 for the average band D home over a year.


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