Councillor allowance to travel to council meetings

Question

Our parish council is temporarily holding meetings in a different building in the parish as the usual place is undergoing renovations.  A councillor has proposed a motion for the next council meeting to temporarily fund the costs of councillor travel to the new venue because public transport isn't convenient for them.  Is this allowed?

Answer 1

We have a travel policy (with a small budget line) which allows councillors and staff to claim travel costs to attend meetings outside of the parish where it is necessary as part of their role as a councillor.  So, if a councillor attends approved training for example, travel there can be reimbursed up to a the maximum amount permitted by HMRC without incurring tax liability.    Given that the role of a councillor is to attend meetings, why on earth should the public fund travel within the parish to enable a councillor to do the job they signed up for?  

An allowance has a totally different implication as councillor allowances, other than in Wales where the rules are different, must be set with reference to your principal authority.

Comments

I agree and I don't think they should do it.  The motion is that 'the council fund the cost of councillor travel to council meetings'.  They are proposing to use the training budget to fund this, as the training budget includes a travel line.  I didn't think that councillors could be paid to travel to meetings inside the parish - is there a law that prevents it, or can the council do what they like?

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Perhaps the approach is that whilst there may not be a law that prevents this, there isn't a power to pay travel expenses within the parish!  If one councillor is permitted to claim expenses, why wouldn't everyone else claim, including staff?

Answer 2

How big can a parish be? Most councillors will live within the parish, so should be able to walk to the meeting wherever in the parish it is. If they choose to drive the cost would be pennies and they should fund this choice themselves. If they are one of the councillors that only works in the parish and lives many miles outside then again this is their choice and they should fund this choice themselves.

Probably technically it would be allowed, but morally you should not be implementing this.

Answer 3

As ever when such questions arise, opinion seems to dominate regulation.

The regulation is as set out below:

https://www.legislation.gov.uk/uksi/2003/1021/part/5/made

26(1)(a) appears to 'allow' for the payment of travelling expenses to attend a council meeting by bicycle or any other non motorised form of transport.  A little antiquated perhaps...

Para 25 - Parish basic allowance - is a much more controversial topic and one which appears to be vehemently opposed in certain quarters - I would submit that perhaps some of the difficulties associated with recruiting and retaining decent Cllrs, especially from a more youthful demographic, might be alleviated by an objective examination and discussion of this topic.

The suggestion that Cllrs voluntarily undertook the role and so should cover their own costs and that walking to a council meeting might be appropriate are archaic and poorly considered but probably widely held.

Walking to a council meeting in, for example, a rural parish with an area of 4500 hectares and with a distance of 7 miles between the North and South, 6 miles between the East and West boundaries, the majority of which is open and exposed, unlit and unpaved upland moor, in Winter, by often elderly and/or infirm individuals (probably unaccompanied) is patently ridiculous and counter to the contradictory duty to consider 'inclusivity' and accessibility.  

Maybe the reference to the 'ability' to pay for bicycle rates will assist the immediate discussion on travel expenses if only to serve as the 'reason' why motor charges might not be lawful.  Perhaps an amendment to the motion to consider Cllr allowances more generally would be a better approach but that is for each council to consider...

   

Answer 4

Yes, it is allowed. The Remuneration Panel established by your principal authority should make recommendations regarding travel and subsistence alongside the core recommendation of a basic allowance. For travel by car, this would normally be the HMRC tax-free rate and for subsistence, probably the principal council's own schedule for simplicity.

Your Council must have regard to the panel's recommendations in setting its allowances, but need not be bound by them. The agreed policy must be publicised alongside the panel's recommendations for comparison. It's also worth bearing in mind that if you resolve to pay more than the HMRC tax-free mileage allowance, payments should be made through your payroll as taxable income. If you stay at or below the HMRC limit, payments can be processed as petty cash or equivalent.

Comments

I'd suggest it is an assumption that allowances paid to Cllrs "must" be via payroll.  I'd suggest there is nothing other than "opinion" to support this position.
I've looked at HMRC BiMs and various other sources and can find no specific reference which "requires" it.

Albeit a fairly academic point (since so few Cllrs are actually paid an annual allowance) it is illogical and entirely unnecessary to increase a councils payroll admin, time and therefore cost by including occasional or annual minor payments to Cllrs.

I have found no formal impediment (other than entrenched "opinion" from the likes of LA and ALC) which "requires" Cllr allowance to be via payroll.  That aside, it is simply illogical.

I can find no reason why they should not simply be off payroll, ex gratia payments made direct to individuals where those in receipt retain responsibility for declaring the "income" via SATR.

There are of course 2 parts to consider here - mileage allowance isn't taxable income - it is reimbursement of incurred expense.  Cllrs annual allowance may be treated as taxable income unless it is shown as an off-set for expenses necessarily incurred in the course of the duty.  
Have I tested this theory - yes.

I was successfully awarded a CCJ against a PC which then tried, under advice from ALC, to demand NI and bank details for payroll payment.  I declined and they paid direct to bank by unlawfully data mining my personal bank details from PC records.

I have personally disproved the point that a payment of Cllr allowance must be via payroll.  It took a CCJ to do it though.

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The requirement is set out in HMRC PAYE 23020 "must submit" and HMRC EIM 30245 which addresses the taxable element of mileage. Mileage allowance isn't a reimbursement of incurred expense, it's a notional sum that pays no regard whatsoever to the vehicle or its running costs.

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Yup, 23020 states that an employer must submit a P46 on commencement and P45 on cessation...
It goes on to state:   "...A councillor is given the choice between having PAYE operated normally on any attendance allowances received
Or
Having tax deducted at basic rate from payments of attendance allowance, excluding any expenses allowance (extended by concession to the special responsibility allowances)

It DOES NOT state that the Cllr cannot include allowances received on their own SATR.

Dancing on the head of a pin in regard to mileage allowance - it is not a taxable deduction so long as it doesn't exceed the AMAP which was my point.

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So the choice is between option A and option B, with no mention of option C.

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We'll have to agree to disagree since I don't see a need for 'C.'

'B' allows the Cllr to arrange for deduction via SATR.

What is interesting though - the requirement for a council to have submitted a P46 for a Cllr taking office and (as night follows day) issue a P45 on cessation.   I bet there are now clerks the length and breadth of the country thinking OMG I haven't done that!
I've ceased to hold office twice - never had a P45.