Agenda item

Report of the Town Clerk on behalf of the Members Financial Assistance Working Party.

The Committee considered a report of the Town Clerk, drafted on behalf of the Members’ Financial Assistance Working Party, concerning financial assistance for Members. 

Noting the concern that the introduction of the report’s recommendations might create a tax  liability to all Members, irrespective of whether they sought the payment, it was advised that the Deputy Chairman of the Finance Committee had explored a possible solution with the City’s Tax Advisers which would create a tax liability only for those Members making a claim. This would leave the choice to claim in individual Members’ hands, thus allowing those who wished to maintain their current position to do so.

Consequently, he proposed an amendment to the recommendations to the effect that such a basic allowance would be implemented on a non-compulsory basis for those Members who wished to claim it, through a Scheme to be designed by the Corporation’s tax advisers, where only those Members receiving the allowance would be liable to pay tax.

Members welcomed the report and thanked the Deputy Chairman for his most helpful intervention. Members emphasised the need to ensure that any solution should be implemented in a way that would not make Members feel uncomfortable, with several Members also noting the benefits that this arrangement might bring in respect of the current diversity agenda and widening representation on the Court. 

RESOLVED: That:-

1.         The introduction of an annual, flat rate allowance, based on the City Corporation’s rate for inner-London Weighting (currently £6,710.04), payable to all Members and effective from April 2021 be approved, together with the following:-

a)     expenses associated with travel, subsistence and caring responsibilities, with childcare and dependent adults being retained as separate payments;

b)     a payment of £500 being made available to Members to cover the cost of formal clothing following election or re-election; and

c)      the City Corporation meeting the reasonable costs of venue hire for Ward surgeries.

2.    Such basic allowance as outlined in recommendation 1 to be implemented on a non-compulsory basis for those Members who wish to claim it, through a Scheme to be designed by the Corporation’s tax advisers, where only those Members receiving the allowance would be liable to pay tax.

3.    Tax and national insurance contributions on benefits in kind and the clothing allowance (which would be become liable as a result of the introduction of an allowance) be met by the City Corporation, subject to the implications of the proposal being examined and approval of the quantum of that liability once it is known.

4.    The introduction of a Special Responsibility Allowance be revisited by the Working Party, following the conclusion of the Fundamental Review and the Governance Review.

5.    Approval of the Court of Common Council be sought accordingly, once the implications of the tax liabilities and final arrangements be confirmed.