One of the most important and obvious achievements of Boris Johnson as Mayor of London has been to freeze the Council Tax precept being charged to hard pressed Londoners. But could he have gone further? Could he have delivered a cut?
The Mayor's Budget is a huge and confusing one. The Greater London Authority "Group" – Metropolitan Police, the London Fire Brigade, Transport for London, the London Development Agency, has gross spending of £14 billion. About half is met by central Government grants. Then there is some income – for instance tube and bus fares and some other items, that comes to £5.5 billion. Some money is coming from reserves, some from "redistributed business rates." But the bit that gets our attention is the £922 million which is to be found by Council Taxpayers. (£309.82 a year for a Band D Council Taxpayer in London.)
TfL and the LDA are almost entirely out of the equation so far as the Council Tax precept is concerned. With the police and the fire brigade, there is certainly scope for further efficiency – although there is an argument that it should be used to provide an enhanced service rather than lower Council Tax – or at least to "share the proceeds."
Then we come to the spending under the Mayor's direct control in City Hall, of the GLA itself. This comes to £134.7 million (down a modest £0.6 million on this year.) Could we not find some further savings here? A saving of £9.2 million would allow the Council Tax precept to fall by 1% rather than be frozen.
We can now help find these savings. In a taste of what to expect from a transparent, cost conscious Cameron Government the details of City Hall spending have been set out via the London DataStore website.
What do we see? The list is long. Each department has their salary costs plus other items such as mobile phones, training, etc, etc.
In a separate category is the London Assembly which costs over £8 million. The Conservative Group proposed cutting the £2.6 million Members Services budget by £250,000. Some of this money is given to each Political Group to spend on its own staff, hospitality, etc. (The BNP get £89,000 a year via our Council Tax precept. The Greens spend £3,000 on printing, £2,000 on mobile phone calls…) The modest Conservative proposal was voted down by the other parties. Legislation would be needed to abolish the London Assembly. But if it continues it should do so at a small fraction of the current cost. Say a saving of £7 million.
The Mayor's Brussels section spends £436,000. The Mayor is right to battle against damaging EU proposals on matters such as hedge funds which represent a threat to the City of London. But is all this spending effective in assisting that battle? We have some good London Euro MPs who the Mayor should work with rather than trying to replicate them. Some businessmen may find such corporatist schmoozing agreeable but that doesn't mean it is beneficial to business as a whole. Saving £436,000.
International Relations has a budget of £296,000. What tangible benefits does this bring? Saving £296,000.
Another £443,000 goes on salaries for "London Stakeholders." Sounds like a waste of money. Sure the Mayor needs to keep in touch with a range of opinion but I don't think he needs this spending to do so. There is also a danger of getting so caught up with "stakeholders" that we focus on interest groups – of self appointed spokesman rather than ordinary people. Saving £443,000
Community Safety and Policing Liason costs £540,000. This is not money that is funding front line crime fighting and seems hard to justify. Saving £540,000.
So far as I understand the Chief Executive of the GLA, Leo Boland, is doing a good job (not least in "delivering the transparency agenda" without which this blog would not have been possible.") I wouldn't necessarily begrudge him his £205,000 a year. But with a leaner operation he should manage with fewer office staff and perhaps his salary cost could be split with him taking on another GLA family member. The budget at the moment is £381,000. Saving £200,000.
"Central and Local Government Liaison" has another £461,000. If the Mayor wants to talk a Minister or a councillor he should pick up the phone and do so. His private office should be capable of getting the phone number. Saving £461,000
The Internal Communications budget of £100,000 strikes me as inessential. Saving £100,000
Public Consultation has £231,000. Consultation can be of practical benefit and unlike his predecessor, the Mayor has sought to make it genuine. But this cost seems to high. Cut the budget 50%. Saving £115,500
Putting on the annual State of London debate costs £191,000. Is this the most expensive talking shop in history? 1,200 punters turned up to the last one. So that's a cost of £159.16 a head. Before the siren voices start bleating: "Oh, but it's a statutory requirement to hold it…" Let's just reflect that such a requirement could be fulfilled at 1% of the cost. A big church hall in Enfield, or Croydon, or Uxbridge, or Dagenham. Announce it on the website. Register first to guarantee a place. Bring your own sandwiches. Cheaper than a central London venue and you might get some ordinary Londoners coming along rather than "stakeholders" (see above.) Make it only a 98% saving to be on the safe side. Saving £187,180.
Best Value and Partnership, employee pay, £199,000. Best value would be to scrap this section. Saving: £199,000.
Ditto Business Development. Saving £1,073,000.
"Policy Evaluation", employee pay, £219,000. We would like to evaluate of policy of lower Council Tax through scrapping such superfluous spending. I think there probably is a case for one or two policy wonks. Boris is very much an ideas man. There needs to be a process to check through them – costing them, the legalities, unintended consequences. But the spending is probably twice as much as it should be. Saving £114,000.
The Private Sector "intelligence" section's comes to £131,000. The private sector needs lower taxes. Saving £131,000.
Children and Young People Section (including Minor Programmes) has a budget £521,000. They produce reports, they hold seminars, they undertake surveys. They do nothing of practical value. Saving £521,000.
The Economic and Business Policy section has a budget of £1.384 million. (This was the section that used to be run by John Ross of Socialist Action during the Livingstone era.) As stated earlier what business needs is lower tax. Saving £1.384 million.
The GLA Economics Section looks like an exceptionally wasteful outfit even by City Hall standards. It spend £1.58 million including £461,000 on consultancy, and £57,000 on corporate subs. Most of its money comes from TfL and the LDA whose subsidies comes from central Government – money that could go on new train stations or sponsoring City Academies. But closing it would also help a bit with lower Council Tax. Saving £349,000.
The Health Policy section and the London Health Commission cost £1.52 million. As I understand it none of this money goes to doctors, or nurses, or to pay for hospitals or medicine. Perhaps with a lower Council tax, more of us could afford to join a gym. Saving £1.52 million.
The Diversity and Social Policy section spends £517,000. It has other funding which meets £487,000. I don't know whether this comes out of the Council Tax precept towards the GLA "family" in another way. But even if it doesn't closing this section would still provide a small help. Saving £30,000.
The amount spent on Public Opinion and Information is £624,000. Perhaps there should be a little polling to keep the Mayor in touch with how he is doing – provided the results are published. Say just a few questions and only one survey a year. Perhaps it could include: "Is the Council Tax precept charged by the Mayor of London too high, too low, or about right?" Let's go for a 90% cut in this section. Saving £561,600.
The Mayor's Environment department costs £2.648 million. Certainly there are important projects the Mayor is involved in to make London a cleaner, greener City – more street trees, rejuvenating parks, etc, etc, etc. But there needs to be a vigorous review to ensure that jobs are only in place where a practical benefit is being delivered. A 75% reduction would be modest goal were this principle applied. Saving £1.986 million.
The Housing Department has an important task in setting targets with the boroughs for new housing. But the £579,000 budget seems far to high. A 50% cut would be reasonable. Saving £289,500.
The Culture Department costs £4,371,000. Why should coming up with a "Culture Strategy" cost £336,000 a year? There is a valid role for the Mayor in this area. Already we have seen more events put on across London and this is welcome (but Events have their own budget of over £1 million.) More should be done at lower cost. For instance more partnerships with the boroughs. A borough council should be able to put on an arts festival or literary festival at rather modest cost – using their Town Hall or putting up some tents in one of their parks, marketing it using the Council's website and publication. Ealing are already doing a good job in this area but the rest of the rest of us could be doing more. A bit of sponsorship from City Hall would be welcome encouragement – say £5,000 a time. Already £577,000 goes in grants to various bodies much of which is certainly well spent – this should be maintained or increased. But the admin should be slashed. Overall there should be a saving of £3,500,000.
Producing the London Plan may be a statutory requirement but should it really be necessary to spend £274,000 a year on consultants in order to produce it? Saving £274,000.
Similarly in the Planning Decision section here is a London wide role but given the Mayor is less confrontational towards the boroughs than his predecessor should there not be some peace dividend? After income from fees this section costs £1,245,000 – halving it would be a reasonable start. Saving £622,500.
Media monitoring costs £143,000. (Probably rather more as this figure is net after £185,000 of income much of which doubtless comes from the GLA family that our Council Tax also helps fund.) Superfluous spending that should cease. Saving £143,000
Marketing costs £858,000 including £308,000 on advertising. Government advertising is an area already identified by George Osborne for an economy drive if the Conservatives are elected nationally. Let's set a clear example in London. Some spending may be justified by nothing like the current scale. Saving £750,000
The Press Office costs £773,000. Although I think a borough council could manage without any press officers this is probably unrealistic for City Hall. But there should be a big cut. Saving £618,000.
Again some staffing for Public Affairs and Public Liaison are necessary as part of the process of accountability but costs of £1,352,000 are astronomical. Saving £1,217,000.
The Sponsorship team seems to cost more in salaries - £143,000, than it raises in revenue - £129,000. Saving £14,000.
Political advisors cost £1,707,000. They are a high calibre bunch. It is necessary for them to be decently paid. But the total bill seems to be nearly a million more than their combined salaries. Sounds to me as if there are too many hangers on. Keep the advisors but scrap the advisors to the advisors. Saving £900,000.
"Resources" is a general budget area that covers an array of things. Facilities Management comes to £2.286 million and includes an £80,000 postage bill. Finance has £1.866 million including £1.35 million in employee costs and £78,000 for consultancy. Human Resources costs £783,000. Legal gets £1,368,000. The Mayor's predecessor was a great friend of the legal profession keenly engaging lawyers when he couldn't get his way. So perhaps this bill is lower than it was – it still seems heavy. "Resources – resourcing" costs us £377,000.
"Resources – Management Costs" seems to cover a multitude of sins coming to over £3 million net. (Consultancy £885,000, Hospitality £57,000, Catering Charge £61,000). "Other external" has £59.1 million – an alarmingly large sum which shows there is still some progress to be made in getting a detailed breakdown. While under "Minor programmes – Resources. Other external" we have £7.912 million. All these are areas where proportionate savings could be expected to those outlined above. Under Management Costs, "C&I" comes to £474,000. Research and Study is £648,000. Say a cut of 80% on all these general areas to be cautious. Saving £63.02 million
The lease costs for City Hall are £5,638,000 a year. Is City Hall a building for servants of the people? Or Masters of the Universe? City Hall is a legacy of Livingstonian empire building arrogance. It is a building for those who want to have power over the people rather than give power back to them. We now have a Mayor who is the people's friend. A Mayor who chats to us on his bike at traffic lights and squashes next to us in economy seats on planes. Yet City Hall is a building suited for those who want to boss the rest of us around. A building where the inhabitants charge the rest of us £137,000 a year to clean their windows. Where insurance costs £352,000 a year and the Maintenance Contract £457,000 a year. A smaller staff would be suited to smaller premises. Some renegotiating of the lease or subletting should save a few million a year – as well as lower running costs. Saving £4.5 million.
These budget adjustments would provide total savings of £92,779,180. This would allow for a 10% cut in the Mayor's Council Tax precept.
Tax cuts create jobs but we can't specify which ones. While spending cuts mean identifiable people lose their jobs. That is why these are difficult decisions to make. Many of those who would lose their jobs at City Hall under my proposals would be bright, well qualified, highly motivated, conscientious people. Some may find themselves understretched at present – but others will be hard working with all the number crunching and report writing. They should be given a generous pay off (financed from reserves or asset sales) and I would hope and expect they would typically have little difficulty finding other jobs. While they may be hard working in there existing posts in their hearts many of them must realise they are stuck in unproductive jobs. They should be set free.