These five maps prove it’s time to reform council tax in England

Bristol, where homes are probably quite under taxed. Image: Matt Cardy/Getty.

As local authorities set out their budgets for the year, council tax is set to rise in many regions across England. Councils in Lancashire, Coventry, Cornwall and Surrey, among others, have agreed to hikes of up to 4 per cent.

But while council tax will be crucial to help local authorities absorb cuts from central government, there are serious doubts as to whether the levy is fit for purpose.

First introduced in 1993, council tax is imposed on properties to help pay for local services, council wages and administration. In general, how much council tax people pay depends on which “band” their property falls into. These bands are allocated by property value, ranging from A (the lowest value) to H (the highest value).


But here’s the catch: in England, council tax bands are still based on property values from 1991.

I decided to map out the differences between 1991 council tax valuations and today’s house prices, to see whether the tax is as regressive and arbitrary as some suggest.

The big housing boom

Let’s begin with some numbers. If your house was worth £50,000 in 1991, and its price had risen with inflation, it would now be worth about double that.

If this had occurred uniformly across the country, it wouldn’t be a problem – but we all know that this didn’t happen. Instead, house prices rocketed, particularly in London and the south-east. For example, in 2014 the average price in Burnley was £85,000 (up 166 per cent since 1995), while in Kensington and Chelsea it was £1.2m (up 558 per cent).

The fact that some prices have risen more than others is a major issue, because it means the amount we pay in council tax is increasingly detached from the relative value of our properties. In other words, those whose properties have risen disproportionately in value are paying less than their fair share of council tax.

House Price Growth, 1995 to 2014. Source: ONS.

Looking at average house price growth in the top and bottom 25 local authorities in England since 1995, we can see that prices have gone up across the board – but there is now a much bigger gap between the richest and poorest areas.

With a little help from colleagues at the Consumer Data Research Centre, I mapped out the differences between house prices and council tax bands. Below, I have shown the biggest council tax band for each area in the borough, alongside a small inset map showing average house prices. Both maps are coloured according to the 1991 council tax banding.

Council tax bands vs house prices, 2015 (Islington). Source: Valuation Office Agency/HM Land Registry/author provided.

Starting with the London borough of Islington, we can immediately see that the variation in council tax bands sits in stark contrast to today’s average house prices. In 1995, the first year data are available for, the average house price in Islington was £105,000. By 2014 it had reached £533,000. Most properties in Islington belong in the top band of council tax – but, according to the data, there are no areas where more houses fall under band H than any other category.

Perhaps unsurprisingly, this is also the case across much of London.

House prices by council tax band in London, 1995-2015. Source: HM Land Registry/author provided.

In more rural locations, such as West Oxfordshire, the contrast between council tax bands and current house prices is not as stark. But the variation is now very much out of line with the original 1991 valuations: some areas have gained value more quickly than others.

Council tax bands vs house prices, 2015 (West Oxfordshire). Source: Valuation Office Agency/HM Land Registry.

To take two contrasting examples from elsewhere in England, we can look at Cornwall and Liverpool. In the former, the purchase of second homes has driven up house prices, so much so that the council removed the 10 per cent discount for these properties in 2013, following a change in government regulations.

Council tax bands vs house prices, 2015 (Cornwall). Source: Valuation Office Agency/HM Land Registry.

Meanwhile in Liverpool, where around 60 per cent of properties are in the lowest value band A, the current variation in house prices is also out of line with the 1991 bands. House prices have risen much faster in some areas than others, particularly in well-connected, inner-suburban areas such as Mossley Hill and Aigburth. The effect – as noted by the New Policy Institute – is that “as time goes by, council tax becomes ever more arbitrary”.

Council tax bands vs house prices, 2015 (Liverpool). Source: Valuation Office Agency/HM Land Registry.

When you look at these maps, the absurdity of continuing to use bands set in 1991 is pretty obvious. Naturally, it raises the vexed question of what should be done.

Well, we could re-value properties and introduce new bands, like Wales did in 2005. Or, as in Scotland, we could pursue more radical change. There, ideas for reform include property revaluation, a land value tax, and even a local income tax.

Personally, I would favour some form of land value tax, as proposed by leading economists such as Dame Kate Barker and Joe Sarling. But of course this brings its own set of challenges: for instance, unfairly taxing the Islington resident who had the good fortune to buy a house there in 1991, but who lives alone and never seeks to benefit from the value of the land or property.


At the very least, a widening of the bands at the top and bottom to reflect the growing gulf between the richest and poorest areas (and the residents' ability to pay) would be a start. With detailed data on house prices, and the technology to crunch complex datasets, this should not be an insurmountable problem. The bigger issue is that, politically speaking, such reform is “dramatic and unpopular stuff”.The Conversation

Alasdair Rae is senior Lecturer in urban Studies & planning at the University of Sheffield. He tweets as @undertheraedar.

This article was originally published on The Conversation. Read the original article.

 
 
 
 

To transform Australia’s cities, it should scrap its car parks

A Sydney car park from above. Image: Getty.

Parking may seem like a “pedestrian” topic (pun intended). However, parking is of increasing importance in metropolitan areas worldwide. On average, motor vehicles are parked 95 per cent of the time. Yet most transport analysis focuses on vehicles when they are moving.

Substantial amounts of land and buildings are set aside to accommodate “immobile” vehicles. In Australia, Brisbane provides 25,633 parking spaces in the CBD, Sydney 28,939 and Melbourne 41,687. In high-demand areas, car parks can cost far more than the vehicle itself.

However, parking is not just an Australian problem. By some estimates, 30,000 square kilometres of land is devoted to parking in Europe and 27,000 km² in the US. This parking takes up a large part of city space, much of it highly valued, centrally located land.

Traditionally, transport planners believed that generous parking allocations provided substantial benefits to users. In reality, excessive parking is known to adversely affect both transport and land use. These impacts, along with recent land-use, socioeconomic and technological trends, are prompting cities to start asking some important questions about parking.

Australian planners must engage with emerging trends to help cities work out the best way to reclaim and repurpose parking space in ways that enhance efficiency and liveability while minimising disruption.

Here we chart likely challenges and opportunities created by these trends over coming decades.

Key trends affecting parking space in cities. Image: author provided.

Land use

All Australian cities have policies to encourage densification, consolidation and infill development in their centres. In conjunction, some cities are setting maximum limits on parking to prevent it taking over valuable inner-city properties.

Transit-oriented development (TOD) has also become popular, at least on paper. This is another form of urban consolidation around transit nodes and corridors. It is known to benefit from high-quality urban design, “walkability”, “cyclability” and a mix of functions.

These developments mean that people who live in CBDs, inner-ring suburbs and near public transport stops will use cars less. Consequently, demand for parking will decrease.

Some non-TOD suburbs are trying to replicate inner-city features as well. For example, some suburban shopping centres have introduced paid parking. This is a significant shift from previous eras, when malls guaranteed ample free parking.

Suburbanites who lack easy public transport access will continue to rely on cars. But rather than driving all the way to a CBD, commuters will increasingly opt for park-and-ride at suburban stations, thereby increasing demand for park-and-ride lots at public transport interchanges. However, excessive capacity might hurt rather than help patronage.


Social trends

In addition to land use, several social trends will affect the need for parking.

First, young people are delaying getting drivers’ licences because driving is culturally less important to them than in previous generations.

Second, people of all ages are moving from outer suburbs to inner cities. For many, this means less driving because walking, cycling and public transport are more convenient in inner cities.

 

inally, the emergence of Uber, Lyft and vehicle-sharing arrangements means that people are not buying cars. Research suggests that each car-sharing vehicle removes nine to 13 individually owned vehicles from the road.

Together, these trends point to a reduced need for parking because there will be fewer cars overall.

Technology

The importance of technology in parking is rising – paving the way for “smarter” parking.

The emergence of a host of smartphone apps, such as ParkMe, Kerb, ParkHound and ParkWhiz, has begun to reshape the parking landscape. For the first time, users can identify and reserve parking according to price and location before starting their journeys.

Apps also make available a host of car parks that previously went unused – such as spaces in a residential driveway. This is because there was no mechanism for letting people know these were available.

In addition, smart pricing programs, such as SFPark in San Francisco, periodically adjust meter and garage pricing to match demand. This encourages drivers to park in underused areas and garages and reduces demand in overused areas.

The advent of autonomous vehicles promises to have dramatic impacts on transport and land use, including parking.

According to one school of thought, mobility services will own most autonomous vehicles, rather than individuals, due to insurance and liability issues. If this happens, far fewer vehicles and parking spaces will be needed as most will be “in motion” rather than parked most of the time.

More space for people and places

The Tikku (Finnish for ‘stick’), by architect Marco Casagrande, is a house with a footprint of just 2.5x5m, the size of a car parking space. Image: Casagrande Laboratory.

The next decade promises much change as emerging land-use, socioeconomic and technological trends reshape the need for, and use of, parking. Cities will devote less space to parking and more space to people and places.

Parking lanes will likely be repurposed as cycling lanes, shared streets, parklets, community gardens and even housing. Concrete parking lots, and faceless garages will likely be converted to much-needed residential, commercial and light industrial use.

The ConversationBy transforming parking, much urban land can turn from wasteland into vibrant activity space.

Dorina Pojani, Lecturer in Urban Planning, The University of Queensland; Iderlina Mateo-Babiano, Senior Lecturer in Urban Planning, University of Melbourne; Jonathan Corcoran, Professor, School of Earth and Environmental Sciences, The University of Queensland, and Neil Sipe, Professor of Urban and Regional Planning, The University of Queensland

This article was originally published on The Conversation. Read the original article.