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Councils rely on charging for 8% of revenue

Councils raise almost half as much money from charging for services as through council tax, according to a report from the Audit Commission today.

in 2006/7, council tax raised £22.4bn from council tax in England, and a further £10.8bn, or £210 for every person in England, from charging for services. After grants from central government, this represents 8% of local authority spend.

Michael O'Higgins, Chairman of the Audit Commission said: "Councils raise half as much from charging for services as they do from council tax, yet the issue attracts much less attention than it deserves.

"The public is more willing to pay charges if they can see what they can get for their money. They need to know why the council has decided to charge for some services, but subsidise others.

"With pressures on public finances and rising expectations, councils should look at what they charge and who pays so they can make better use of charging to improve outcomes for local people," he said.

According to the Audit Commission, councils are not aware of how charges for services contribute to their overall expenditure, and do not understand how charging approaches compare with other councils.

They recommend a review of the limits local government can impose on that local authorities' charging powers to ensure they are justified.

From 2009 the Audit Commission will look at how individual councils use their powers to charge as part of its annual use of resources assessments. These assessments are carried out at all councils as part of the external audit by appointed auditors.

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