Rates & Services
It has been said that people pay their fares in sorrow, but their rates in anger. This is still true although rates now take on average a smaller percentage of personal incomes (net after tax) than they did before the war; the actual figures are 4.2%; in 1960 compared with 5.2%; in 1938.
Local authorities have only three sources of income, the rates, government grants (which contribut more to local expenditure than the amount raised through rates) and “trading and specific” income.
It is worth considering what services we are receiving for our money. Education is by far the largest charge on local government income. When a Conservative government came to power in 1951, £381m. was spent annually on education in Great Britain as a whole. Such is the priority that education has been given in our economy that this year the comparable figure will be £978m. (This takes no account of the sums spent on private education).
Some of the factors which have necessitated this rapid increase could not have been foreseen. The rising birth-rate, together with the fact that more children have stayed at school after the age of 15, has resulted in an increase in the number of pupils in primary and secondary schools of nearly 1¼ million in the last ten years. New schools have had to be provided for these children and old schools have had to be repaired. Altogether some 2¾ million new school places have been provided since 1951.
As well as new schools we have needed more teachers and consequently more teacher training colleges. The number of full-time teachers has risen by nearly 60,000 in the last ten years, but this is not enough. A six year programme to more than double the number of training college places from 23,000 to 47,000 by 1966 is now in hand at a cost of £36m.
This is but a part of the vast programme for the expansion of educational facilities. It will mean increases in rates in future years as well as bigger grants from the Exchequer.
Housing is another very large item of expenditure. Here again the plans have been confounded by a rise in population far higher than was anticipated. The Preliminary Census report shows that the population increased by 2½m. between 1951 and 1961. In 1951 there were a million fewer dwellings in England and Wales than there were households. By 1961 the census report showed that there are almost exactly as many dwellings as households, but this figure conceals the severe shortage of houses in some areas.
Clearly, as prosperity increases families are becoming more and more home conscious and will require more housing accommodation.
Although nearly four million houses have been built since the war, the demand for new houses will continue to be high for several years to come.
At present, local authority housing is the only substantial source of new homes built to let. Over a quarter of this building is now being devoted to the kind of accommodation most needed by older people.
Other vital services to which ratepayers contribute, are the police and fire services. Both were experiencing difficulty in recruitment before the recent pay increases.
Both central and local government representatives face similar problems of rising expenditure. We are constantly being urged to spend less in total and yet to spend more on each individual item. Economies which are secured in one department are quickly swallowed up and overtaken by increases in others. This point is well illustrated by the estimates for the government's expenditure in the coming year. In spite of all out efforts the total amount is up by £384m. and yet a quarter of the items are lower than they were last year. Most of the increase is accounted for by six items—the railways deficit requires a further £43m. (the total annual loss on the railways is now £151m.); Defence nearly £100m. more; Agricultural subsidies £66m. more; extra grants to local authorities to finance education, including the higher pay for teachers, take £86m.; National Health Service expenditure another £27m. and roads a further £15m.
There are many objectives which are desirable in themselves, but which added together are beyond our resources. Constant scrutiny is necessary if the collective total is to be contained within reasonable limits. This is the task of central and local government.