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Fiddling with Figures?

Fiddling With Figures?This article is about a couple of the charges that appear on your Fylde Council Tax Demand.

Mostly it's about Fylde's 'Special Expenses' charge which is not being charged as close to actual service costs as it could be, but we also note something one of our eagle eyed readers picked up and pointed out to us - the matter of a LCC separate precept charge for Adult Social Care

We begin with a quick Background to Special Expenses, before nothing the start of this matter at Finance & Democracy Committee, where Cllr Liz Oades asked a question, then Got an Answer.

Then we try to make sense of What the Answer Means, and we Look in Some Detail at the Figures, and conjecture on what might happen if the towns Were Accounted For Separately, and we wonder if anyone saw What Was Going On.

We see how Princess Karen Responded, and consider whether Anything is Likely to Change.

Finally, we look at the conundrum of how the Government has helped Lancashire County Council to increase its Precept for Adult Social Care from £22.60 last year, to £46.10 this year,  and say that is a 2% increase (sic). With accounting like that, we thought Fylde's Commissar might be back. Thankfully, he's not.


Our long time readers will recall the acres and acres of screen space we have previously devoted to the con trick that was first (euphemistically) called 'Equitable Taxation' and later known by its proper Sunday name of 'Special Expenses'

Well it was dragged back into public consciousness recently.

For those who are unfamiliar with the history, the idea was that Fylde allowed / persuaded most Parish Councils in the Borough to charge a separate precept for maintaining the parks and open spaces in their areas.

Fylde were happy to do this because it meant that Parishes raised the money themselves.

But FBC didn't reduce the charge it had been making for this work when the Parishes started to charge for it themselves - it continued to charge the same Council Tax as before.

We calculated FBC raised an extra £300,000 in extra Council Tax by this ruse - which they had admitted from the early days was a device to get around the Council Tax capping arrangements to give them more money.

St Annes Town Council (which is also technically a Parish council) was not given the opportunity to do this. The argument FBC used was that in the rural area, the Parishes owned most of the Open space land themselves (they had been allowed to keep ownership of it when the new Fylde Borough Council was created in 1974), but in Lytham and St Annes at that time, there was no Parish or Town Council, so the land was owned by FBC itself, and they decided not to pass ownership of that land to what is now St Annes Town Council when that Parish was created.

Fylde also argued (we think with some justification) that some of the bigger parks and gardens in Lytham and St Annes are intended to serve an area that is larger than just Lytham or St Annes e.g. Fairhaven Lake or Ashton Gardens and Lowther Gardens. FBC has expressed the view that these are - in effect - borough-wide or tourism facilities the operating costs of which should be met by all Fylde residents, not just those living in Lytham or St Annes.

Before 2008, rural Town and Parish Councils operated the parks and open spaces in their area but the cost of doing so had been met by FBC under what was known as "open spaces grant."

We thought this was a good idea because it meant that the cost of operating parks and open spaces was shared equally between all Fylde's taxpayers. (We can see some parishes - like Greenhalgh & Thistleton - wouldn't agree with us on this because they had no parks or open spaces, but their residents still contributed to the costs elsewhere in Fylde. - It's a bit like a hotel swimming pool, the cost of which is included in the room price whether you use it or not).

However, in 2008, seduced by the prospect of their being completely their own masters, the parishes agreed to precept for open spaces costs themselves, and the decision of FBC from its early days was reversed.

Rural parishes charged their residents, and in Lytham, Ansdell and St Annes a 'Special Expenses' charge was introduced to fund open spaces maintenance there.

But although Fylde keeps separate accounts for the cost and income for most to the work in Lytham and in St Annes, it does not make a separate charge to each township, it charges them as one collective sum for 'Lytham St Annes' divided by the number of residents in both communities,

Readers can follow this link to download an official outline of this matter as a pdf file.


When the budget for 2017-18 was being considered, the arrangements reported to the Finance and Democracy Committee included the following:

"...(f) The Special Expenses policy as set out in Appendix I; which includes that:

  • for the purposes of charging special expenses, both the special expense costs and the tax bases relating to the areas of Lytham and St Annes will each be aggregated and the Council Tax charge per property at each band level will be the same across the whole area; and

  • the annual special expense charge per property will be set for 2017/18 at the 2016/17 level plus 2.76%, that being £71.77 per band D property; and

  • the annual borough wide charge per property will be set for 2017/18 at the 2016/17 level plus 2.76%, that being £152.98 per band D property; and

  • the budget resource to be allocated to delivering concurrent services and chargeable as special expenses for 2017/18 will be set at a sum equivalent to the annual special expense charge per property (band D equivalent) multiplied by the tax base for the special expense area"

This is quite technical wording but in effect, it says LSA will be charged as one area, and both the previous Special Expenses charge for parks and open spaces, and the charge for other services will each be increased by 2.76%"

We were not that excited by this.

The underlying logic of Special Expenses is that where a Council is providing services in only part of its area, it should charge that cost only to those residents that receive it, and the cost should be the actual cost of the service divided equally amongst the residents.

Now it may be that, coincidentally, the cost of providing the parks and open spaces maintenance has increased by the same amount as all the other services Fylde delivers - and that justifies the 2.76% increase in open spaces, but it looks to us as though Fylde has applied an arbitrary 2.76 % increase on its special expenses irrespective of what the actual cost of delivering the service was.

We were planning to have a look at this, but had not yet had time.


However, another aspect of this charge was picked up by a Councillor, because at the Finance and Democracy Committee of 20 February 2017, Cllr Mrs Oades said:

"It's about (f), the Special Expenses policy, I wonder if we could be given the separate special expenses charges for Lytham and St Annes please, if not now that we could be sent them?"

The Finance Officer replied

"The Special Expense charges are the same in Lytham and St Annes. The policy treats the two as a single taxbase, so it's a standard charge across the whole area"

Actually, (and unusually), Queen Elizabeth had asked the wrong question - or rather she'd asked the question in the wrong way, and the officer was either being very careful to answer what she said, or he was trying to avoid giving the answer she wanted. Only slightly put off, she said

"So you've aggregated them, so are you not able to show exactly what it does cost in St Annes, and exactly what it does cost in Lytham?"

This was the right question, she wanted to know the cost in each, not what the Council was charging. The officer replied

"Yes, sorry I thought the question was about the charge rather than the cost, yes, I can provide that analysis, yes"


He did so subsequent to the meeting, and we asked Cllr Mrs Oades if she could tell us what he had said.

She told us he had said:

"The budgeted cost for 2017/18 for the special expense cost centres are as follows:

  1. Parks and Leisure sites/activities, Xmas trees etc. in St Annes £572,106

  2. Parks and Leisure sites/activities Xmas trees etc. in Lytham  £598,216

  3. Development supplies & services across both Lytham and St Annes. £82,495

  4. Total Special Expense Resource 2017/18 £1,252,817"

Now, superficially, there doesn't look to be much difference between the charges for St Annes and for Lytham.

On half a million spending, £26,000 isn't that great a difference. But it's not that simple in practice.

Cllr Mrs Oades went on to tell us the Finance Officer had explained it further to her saying:

"Each year, as part of the budget-setting process finance officers ensure that the total budget resource of the relevant cost centres that relate to the provision of the special expense services (as described above in Lytham and St Annes) equates to the total special expense charge (i.e. In Lytham and St Annes) that is levied for those areas."

That's just what we would have expected (and why we were puzzled that a 2.76% increase had been applied to last year's figure)

"For 2017/18 this total amount is:

Taxbase for Lytham (7,662) plus taxbase for St Annes (9,794) = 17,456

Multiplied by the proposed special expense charge for 2017/18 (£71.77) = £1,252,817."

He added it was worth noting that the taxbase [the number of residences and people] for the two areas will vary from year-to-year as a result of not only [changes to] the number of physical residential buildings for each area but also due to changes in entitlement to discounts (e.g. for single person occupancy), empty property discounts and premium and as a consequence of eligibility for Council Tax Reduction Scheme discounts amongst the resident population.


What this means is that to get the cost per Band D property, you have to take the cost in Lytham and divide it by the taxbase for Lytham (that's the number of Band D equivalent properties in Lytham). And separately you have to do the same for both St Annes figures.

The difficult bit is that the Parks Development supplies & services are not accounted for separately in Lytham and in St Annes, it's just a global sum for both places. However, it's not a huge component, and the usual way to deal with a cost like this is to apportion it out pro-rata to the known costs.

If you do this, it gives a split of the development costs as: 48.9% to St Annes and 51.1% to Lytham.

Given that the Parks Development costs are less than 7% of the total, and the known costs are 93% - this is not an unreasonable approach to adopt.


Put into practice (and including the parks Development Costs) this means

The cost of providing the service in Lytham is (£598,216 + (51.1% of £82,495 = £42,155)) = £640,371

The cost of providing the service in St Annes is (££572,106 +(48.9% of £82,495 = £40,340)) = £612,446

However, in terms of the difference in costs, the taxbase magnifies the impact a lot.

There are 7,662 Band D Equivalent properties in Lytham.

There are 9,794 Band D Equivalent properties in St Annes

So there are a lot more properties in St Annes, and the service being provided costs less in St Annes than it does in Lytham.

When you calculate each area separately on a per household basis, the special expenses in Lytham are:

The service cost of £640,371 in Lytham, divided by 7,662 Band D equivalent properties in Lytham = £83.58

And the special expenses in St Annes are:

The service cost of £612,446 in St Annes, divided by 9,794 Band D equivalent properties in St Annes = £62.53

But because of the policy that the Council adopted, Fylde treats both areas as one -  so they've said

Total cost for LSA: ( £640,371+£612,446) = £1,252,817

Total properties for LSA (7,662+9,794) = 17,456

Therefore the LSA special expense charge is: a service cost of £1,252,817 divided between17,456 properties, and it becomes £71.77

And this is how the recommendation in the Medium Term Financial Strategy that went to Finance and Democracy on 20th Feb was able to say

"..the annual special expense charge per property will be set for 2017/18 at the 2016/17 level plus 2.76%, that being £71.77 per band D property; and.....


If the policy of single area charging was not in place:

  • Lytham Band D properties should be paying £83.58
  • St Annes Band D properties should be paying £62.53

The logical outcome of this is that St Annes Band D households should be paying £62.53 a year in special expenses and Lytham should be paying £83.58.

So it can truthfully be said that St Annes residents are currently subsidising Lytham residents in the Special expenses that are being levied.

The difference overall between the two is £21.05 a year

We're both paying £71.77 this year, but those in St Annes Band D properties are being 'overcharged' by £9.24, and Lytham residents are being 'undercharged' by £11.81

(the two together add up to the £21.05).


We were not the only ones to spot this going through Fylde's accounting grinder.

St AnnesTown Councillor Carol Lanyon (who is developing something of a reputation for being good with the details) had also spotted it, and asked a question in the Public Question Time at the Council meeting of 3 April 2017.

We understood her to say she spoke as a resident of St Annes, not on behalf of the St Anne's on the Sea Town Council.

The minutes of Fylde's meeting record:

"The following question from a member of the public was asked by Mrs Carol Lanyon, St Annes

“At the budget meeting held last month, mention was made again of the fact that St. Anne’s residents are paying more in their council tax (Special expenses) than Lytham residents are, and that in effect St Anne’s council taxpayers are subsidising Lytham’s tax payers to the tune of approximately £21 for a Band D property.

This seems to me to be grossly unfair and certainly not a robust and transparent method of collecting council tax. I would like to know

A. The reason behind this accounting anomaly for charging special expenses across both areas.

B. Why the development and supplies services budgets cannot be split between the two areas separately.

C. What steps elected members of Fylde Council are going to take to address this issue, so that St. Anne’s residents are not subsiding Lytham residents, as they are at present.”

We thought that was a pretty comprehensive question.


In terms of a response, Fylde's minutes note

"Councillor Karen Buckley responded stating that residents in the same council tax band of properties paid the same amount of special expenses regardless of whether they lived in Lytham or St Annes.

For 2017/18 the special expense charge was £71.77 for a Band D property in each of the two areas.

She advised that the only parks and open spaces owned by Fylde Council were in the Lytham St Annes area and accordingly Fylde Council had a special expense policy to charge for the maintenance of these assets.

The policy expressly treated the whole area as a single tax base and charged the same amount to residents across the whole area. Councillor Buckley explained that the approach allowed for operational flexibility to the Parks Team in the delivery of the high standard of parks and open spaces across the whole area.

She further explained that elsewhere in the borough assets of this nature were owned and managed by Town and Parish Councils and the cost of their upkeep were charged to residents via the parish precept.

She concluded by stating that the existing policy was clear and transparent.

The Mayor asked if Mrs Lanyon had a supplementary question,

Mrs Lanyon asked “Is Councillor Buckley suggesting that this method of taxation is considered to be equitable as residents of St Leonard's ward, that I have spoken to, don’t consider it to be so?"

Councillor Buckley responded advising that to charge Lytham and St Annes separately would be a departure from the approved method. The present method was open and transparent and the Council’s policy on special expenses was reviewed every year."

We think this is a less than satisfactory reply from Princess Karen - but in reality, it's the only one she could have given.

It's what we'd call a 'Mummy Reply' - that's a reply as given to a child when there is an inability to properly justify the rationale for a particular decision and it comes out as "Because I say so"

In effect she was saying the Conservative group had used its majority to put this policy in place and that was it.

End of.

We didn't think this was a proper answer to Mrs Lanyon's first question

Her second question had been dismissed with a vague reference to the Parks Service needing flexibility (as though such flexibility couldn't be taken into account and delivered in a system that adjusts the annual Special Expenses charge recover actual spending)

And Mrs Lanyon's last question (what steps would be taken to change things for the future) was not answered at all so far as we could see, unless you count the bit about the Special Expenses policy being reviewed each year, and - quite honestly - we're less than comfortable with Princess Karen's use of that expression anyway.

To our knowledge, there has not been an annual (or any) item taken to a Finance and Democracy Committee with a report from officers about the merits and de-merits of charging special expenses as an aggregated sum, or charging them as separate sums to each township. There has been no exposition of the arguments for or against either way of doing it.

The best that can be said is that (as sub-item (f)) in the long list of technical recommendations it becomes part of series of recommendations from the Financial Officer which are part of the terrifyingly complicated sounding " Medium Term Financial Strategy Update, including General Fund, Capital Programme and Treasury Management for 2016/17 to 2020/21" that the Council considers each year.

We think it would have been clearer for Cllr Mrs Buckley to say the policy was reported, recommended and voted on each year.



But perhaps before next years budget, one of the Finance and Democracy Committee members will formally call for an item to be placed on an agenda, accompanied an officer report outlining the pros and cons of each way of doing it.

Or maybe it won't make it onto and agenda anyway, because the Conservative majority, whose powerbase is chiefly in the coastal strip probably wouldn't want to debate an item that could see Conservative councillors representing Lytham arguing against Conservative councillors representing St Annes.

So we don't expect much to change anytime soon.


When the Council Tax bills started to arrive this year, one of our readers spotted something odd in relation to the County Council's charges.

Specifically it was an item that appeared on our Council tax bills for the first time in 2016/17, and it was a separated out charge for Adult Social Care.

This had been authorised by the Government as part of a reform of the precepting powers that Councils have.

In 2016, Communities and local government secretary Sajid Javid had announced a package of reforms which included a £240m ‘adult social care support grant’ would be introduced the following year, and be divided between local authorities based on need. He said this would generate nearly £900m extra for adult social care services over the next two years.

Councils would be handed more flexibility in how they use the social care precept so that they can bring forward more funding in 2017-18 and 2018-19.

He said Councils were previously allowed to raise council tax by up to 2% per year under the precept. However, from next year local authorities would be allowed to use the social care precept to raise council tax bills by 3% in 2017-18 and a further 3% 2018-19.

As well as increasing their charges, he said the adult social care support grant will be funded through savings generated by reforms to the government’s ‘new homes bonus’ that Fylde had been counting on getting, but the reforms took a huge slice away from FBC and this money was funding the 'new' Adult Social Care grant to Councils like LCC,

Not all the agencies involved were ecstatic. We heard one say that the money announced by Mr Javid was a “mere fraction” of what was needed.

Now, we keep hearing that more money is needed for old folk who bed block the NHS because there is insufficient family or social services support to allow them to be discharged from hospital, so maybe this is a good idea.

But, like our reader, we're less than impressed with the accounting arrangements LCC seem to be putting in place.

The council tax bill now breaks down as follows for a 2016/17 and 2017/18 Band D property.

Precepting Authority 2016/17 2017/18 % Change
Lancashire County Council £1,152.26 £1,175.64 2.0
Police & Crime Commissioner £162.22 £165.45 2.0
Lancashire Combined Fire Authority £65.50 £65.50 0.0
 Lancashire Adult Social Care £22.60 £46.10 2.0
Fylde Borough Council £148.87 £152.98 2.8
FBC - Special Expenses £69.84 £71.77 2.8
Charge For Period £1,621.29 £1,677.44 3.5

 Can our readers spot the oddment in this list ? Well, our eagle eyed reader wondered how an increase from £22.60 to £46.10 could be classed as a 2% increase.

We did too when he pointed it out to us.

At first we wondered if Fylde's former Commissar (whose accounting was always pretty suspect) had been given some sort of role in Adult Social Care - because that sort of increase would have been quite normal for him.

On a 2016/17 precept of £22.60, we'd expect a 2.0% increase to have given £23.05, but it wasn't. It was £46.10.

The 'real life' cash change that took the £22.60 to £46.10 is actually an increase of 104%

It turns out that there is a reason - albeit one we find distinctly odd.

And LCC may not have done anything wrong. (Because we think it might be that nice Mr Javid who's told them they can do it this way).

The logic is that until 2016, Adult Social Care was part of the LCC's main spending which (as readers will note) went up 2% from £1,152 to £1,175.

At the same time the Social Care component was extracted and went from £22 to £46.

What we think has happened is that although the charge has been separated out for us to pay, the money hasn't been separated out from the main fund for the purposes of calculating the increase.

What looks to be happening is that there is an increase of 2% has been applied to LCC's main budget, and that 2% of the main budget is being applied as the cash increase to whatever was being charged last year for the Adult Social Care precept.

So this years (slightly rounded) figure for Adult Social Care is last year's £22.60 Plus (2% of £22.60 = £0.45) Plus (2% of £1,152.26 (= £23.04)) = Overall £46.09 (£46.10?)

We see shades of Fylde's 'Special Expenses' con trick here.

if as we suspect, LCC has calculated their 2% increase on their main budget and then put that cash amount into their (now separated) Adult Social Care budget, then we argue  they have 'used up' their 2% increase - and they ought not to be able to calculate another 2% and add that as *another 2% increase* to their main budget.

But when you do the sums, you find that looks to be how the increase works out.

Under the current Government Guidelines the Adult Social Care will continue increase further over the next two years.

We understands the same logic will apply next year too, (when the £46.10 has another 2% increase and becomes approximately £70 next year) and it is expected to become £94 the following year.

If the money had been kept within, and treated as, LCC's main budget LCC would only have been able to apply the 2% increase once, but it appears that Mr Javid has agreed a change in the rules that allows them to do it twice.

But if our sleuthing has produced what is actually happening, then we regard it being downright dishonest to show it as a separate precept. This has allowed LCC to increase its own precept separately from the apparently new precept for Adult Social Care.

Honesty, openness and transparency? Pah!

Dated:  19 May 2017



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