One of my photos

Council tax maths tricks

April 4th, 2006 · Posted by Skuds in Politics · 1 Comment · Politics

I really am full of admiration for the Tories’ latest leaflet, and for two main reasons.

The first reason is trivial, but means a lot to me. The latest one actually followed basic design principles. Normally they get carried away with fonts and have so many different ones that it gives the impression of a primary school newsletter – layed out by the pupils.

The other reason is that it shows a remarkable talent for presenting statistics in a sensational way. They make a point which is difficult to counter because they use one figure in isolation which is attention-grabbing but not the full story. However, if we put the full counter-argument it would be far too boring for most people to bother reading and would not have the same impact.

The attention-grabbing headline was that council tax in Crawley has risen by 98% since 1997. That doesn’t sound good, and for a moment I was shocked myself until I thought about it.

The key point, of course, is that council tax stands alone. It is not linked to earnings, income or current property values. Over the same period of time, for example, my income tax has increased by more than 98% without any increase in the income tax rates, purely because my salary increased. In fact over such a long period you could pick plenty of things which have increased in price by at least 98% but which are now more affordable than they were in 1997.

A little tip for anyone faced with a statistic like this is to ask why it was chosen, for chosen it surely was. Why pick the 9 years from 1997 and not a round 10 years for example?

The answer to that one is easy. 1997 rings all sorts of bells as the year the Labour party came to power nationally, so there is an implication that everything after that is the responsibility of Labour. The thing is that, regardless of the government, the council tax has been set by a Tory county council and a Labour borough council. If the Tories want to keep claiming credit for their acheivements in the county council they can at least claim ‘credit’ for the taxes they impose from it too.

Another strange thing about annual percentages is that they can add up pretty quickly. You might assume that something which increases by 4% a year will take 25 years to double (25 times 4% = 100%) but actually it would more than double in 18 years because of compounding.

So, taking the same set of data (band D council tax in Crawley), they could have pulled out the following statistics instead:

  • Since 1997 the county council element of council tax has increased by 103.5% – more than double!
    (Equivalent to an increase of about 8.2% every year)
  • Since 1997 the borough part of council tax has increased by 61.9%
    (Equivalent to an increase of 5.5% every year)
  • Since 1997 the county council’s proportion of council tax has increased from 75.5% to 77.5%
  • Since 1997 the borough council’s proportion of council tax has reduced from 16.6% to 13.6%
  • Since 1997 the borough council’s element of council tax has increased by £67.05 while the county council’s element of council tax has increased by £509.40

All those figures are as real as the 98% total council tax figure (unless I cocked up in Excel) but none are quite as sensational.

But why stick with 1997 as a baseline? Go back as far 1994/95 and in 12 years the council tax has increased by 139% overall with the county element increasing by 127% and the borough element increasing by 77%.

The Tories will mention the matter of the government’s support grants, but in reply we only have to look at the support grants for the last years of the Tory government where in the years leading up to the 1997 election support for the borough was cut by £5m and £.1m.

One built-in advantage the Tories have over us is that the county council, which they control along with its budgets, has elections once every four years. Look at the history of annual council tax rises and see if there is a pattern:

5.7%, 11%, 7.4%, 5.8%, 6.5%, 9.7%, 18.5%, 5.9%, 4.8%

Guess which years were county election years!

The most important thing to remember about council tax, and the one thing which the Tories never forget is this: although only a small part of it goes to the local borough council it is the borough that collects it on behalf of the other authorities, the local borough which sends out the bills and the local borough which the public associates with the whole amount. In other words, in our situation the Tories can increase their part of the tax but the Labour party locally who get the blame.

So congratulations to the Tories. Since council tax was first introduced (and we all remember how popular that was!) the Labour borough council portion has gone up by 22.3% while the Tory county council portion has gone up by 149.7% but they have plucked out one percentage which appears to persuade us that our Labour council are a high-tax authority purely because it sends out the bills for their taxes.

But it must be true because numbers don’t lie do they…?

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One Comment so far ↓

  • Andrew

    Nicely done. I’m always amazed at how devious people can be with statistics. I also didn’t really know how council tax worked on borough/county levels, so this is most interesting.