“On average, Labour councils charge you £93 more in band D than Conservative councils, and Liberal Democrat councils charge you £120 more”
At Prime Minister’s Questions on 28 April, the Prime Minister claimed Conservative councils charge less council tax than Labour and Liberal Democrat councils ahead of local elections on 6 May.
This was essentially the same campaign line used by the Conservatives at the last local elections.
It’s true that Conservative councils charge lower band D council tax, but it doesn’t mean what you might think. Conservative areas have more expensive houses, which means they have more houses in higher bands. Conservative councils can therefore often afford to have lower rates on band D homes.
The average council tax in Conservative areas is much higher than in Labour areas. And the average in Liberal Democrat areas is higher still.
What band D is and why it matters
In England, houses are classified, by value, into one of eight bands.
The values of each band don’t vary across the country. A band A home, for example, would have been valued at less than £40,000 in 1991, whether it’s in Kensington or Keele.
Poorer areas therefore have more homes in lower bands, while wealthier areas have more homes in higher bands.
Individual councils then set council tax for each band, charging more expensive homes more tax, and cheaper homes less tax.
Band D is roughly in the middle, so it might appear to be a good measure to use when comparing rates between areas. Councils also set tax for other bands as a proportion of the band D rate. And rates on this band are commonly used to make comparisons.
However, band D rates aren’t actually the average tax that households pay, nor are they particularly close to it. Across England, two thirds of homes are in bands A, B and C, so a band D bill is higher than most households will pay.
But this is not true everywhere. In wealthy areas with expensive homes, band D is below the average, whereas in poorer areas, with cheaper homes, it’s above the average.
In part, because of the types of councils the two parties tend to control, the band D rate is, on average, higher in Labour areas but the average tax per household is higher in Conservative areas.
For example, the London commuter town of Wokingham is a pretty well-off place. If you’re living in a band D home in Wokingham, you’re probably living in a below-average house for the area—even though that house would be valued in the top third nationally.
On the other hand, Durham, is not so well-off. More than half the homes are in band A. So if you are living in a band D home in Durham, you’re in one of the most expensive homes in the area.
In Wokingham, the average council tax is £2,093 a year per household, far above the £1,258 per household in Durham.
But the band D rate in Wokingham is £1,689, lower than the rate in Durham of £1,801.
So even though Durham, which is Labour-run, charges a lower average rate than Conservative-run Wokingham, the band D measure makes it look like it charges more.
Essentially, in Wokingham, the band D rate can be kept lower, because there are plenty of Band E, F, G and H homes which pay a higher tax rate. In Durham, band D homes are charged more than average, as the majority of the residents live in cheaper housing.
The actual average
Using the real averages, as opposed to the band D rates, shows a very different picture.
The average tax per household in Conservative areas in 2021/22 is £1,592, while in Labour areas it is £1,256, and in Liberal Democrat areas it is £1,700.
These figures aren’t perfect, because of how local government is structured in England.
Many areas have a single tier of local government, with one council responsible for all or almost all local services in their areas, which collect tax to pay for it.
But in some places, there are two tiers of local government, where county councils cover a large area and provide most local services, but tax is collected on their behalf by smaller district councils (who also collect council tax for the few services they provide themselves).
For example, in Exeter, Labour run the city’s district council, while the Conservatives run Devon County Council.
Because almost all county councils are Conservative-run, that means that the Labour district council figures should be treated with caution, as they essentially collect tax largely on behalf of Conservative councils.
Unfortunately, the government doesn’t publish the separate figures for the average tax charged by each county and district council (although it does for band D rates), so you can’t comprehensively compare average council tax rates across the country.
But if you remove district councils from the equation (in other words, if you look just at the tax charged by councils in single-tier areas) you get the same broad picture.
The average council tax in these single-tier areas is £1,552 in Conservative areas, £1,222 in Labour areas and £1,800 in Liberal Democrat areas.
None of this really shows whether Labour, Conservative or Liberal Democrat councils are better run.
A council may charge higher rates of tax because it is inefficiently run, or because it needs to spend more money to provide services in its area, or simply because people in that area are willing or able to pay more tax in exchange for better services.
The band D calculation
While it’s not a useful measure for this sort of comparison, the Prime Minister is correct to say that band D rates are higher in Labour and Liberal Democrat areas than Conservative areas.
However, we haven’t been able to precisely replicate the Conservatives’ calculations. When we asked how they were done, the party told us that it used government data and “averaged across tiers by party control”, but it did not provide more details. This detail is important, because the calculations could be done in several ways, some more reliable than others.
Back in 2019, when the party used the same election message, it did provide us with its calculations, which contained various errors.
We don’t know whether these errors have been corrected this time around.
By our calculations, in single-tier areas, the average band D rate for Conservative councils is £1,487, lower than £1,537 for Labour councils and £1,589 for Liberal Democrat councils.
In two-tier areas, with both a district and a county council, the average band D rate for district councils is £234 for Conservatives, £253 for Labour and £236 for Liberal Democrats.
We can’t compare county councils in these areas, because neither Labour nor the Liberal Democrats control any county councils outright.