§ Sir Ian Gilmour
To ask the Chancellor of the Exchequer, further to his reply of 14 December 1990 to the right hon. Member for Chesham and Amersham,Official Report, column 538, if he will estimate by how much the standard rate of personal income tax would need to be increased if (a) education and (b) education, fire and police were financed by income tax, assuming no change in the grants paid by central Government to the local authorities; and if he will also estimate savings in community charge benefit in each case.
§ Mr. Norman Lamont
[holding answer 15 January 1991]: If local authorities spend in line with central Government's assessments in 1991–92, expenditure on education in Great Britain will be around £21 billion, expenditure on education, fire and law and order services will be around £28 billion, and total income from 'the community charge would be around £14.5 billion.
Assuming no change were made in the level of revenue support grant and non-domestic rates paid by central Government to local authorities, the basic rate of income tax would need to increase by (a) 8½p and (b) 10p if these services were financed by income tax. However, if education, fire and law and order services were funded in line with these proposals, the extra central Government funding would more than exceed anticipated community charge income for 1991–92. The saving on community charge benefit would be around £2 billion.