Chapter VIII: Finance

In addition to the provisions that have been mentioned above (Section
VII.), the London Government Act 1899 simplified administration in two
respects. The duties of overseers in London had been performed by most
diverse bodies. In some parishes overseers were appointed in the
ordinary manner; in others the vestry, by local acts and by orders
under the Local Government Act 1894, was appointed to act as, or
empowered to appoint, overseers, whilst in Chelsea the guardians acted
as overseers. The act of 1899 swept away all these distinctions, and
constituted the new borough councils in every case the overseers for
every parish within their respective boroughs, except that the town
clerk of each borough performs the duties of overseers with respect to
the registration of electors.[4] Again, with regard to rates, there
were in all cases three different rates leviable in each parish--the
poor rate, the general rate and the sewers rate--whilst in many
parishes in addition there was a separate lighting rate. From the
sewers rate and lighting rate, land, as opposed to buildings, was
entitled to certain exemptions. Under the act of 1899 all these rates
are consolidated into a single rate, called the general rate, which is
assessed, made, collected and levied as the poor rate, but the
interests of persons previously entitled to exemptions are
safeguarded. Further, every precept sent by an authority in London for
the purpose of obtaining money (these authorities include the London
County Council, the receiver of the Metropolitan Police, the Central
Unemployed Body and the Boards of Guardians) which has ultimately to
be raised out of a rate within a borough is sent direct to the council
of the borough instead of filtering through other authorities before
reaching the overseers. The only exceptions to this rule are: (1)
precepts issued by the local government board for raising the sums to
be contributed to the metropolitan common poor fund; and (2) precepts
issued by poor law authorities representing two or more poor-law
unions; in both these cases the precept has of necessity to be first
sent to the guardians. The metropolitan borough councils make one
general rate, which includes the amount necessary to meet their own
expenditure, as well as to meet the demands of the various precepting
authorities. There was thus raised in the year 1906-1907 a sum of
£15,393,956 (in 1898-1899 the amount was £10,401,441); of this
£11,012,424 was for central rates, which was subdivided into
£7,930,275 for county services and £3,082,149 for local services,
leaving a balance of £4,381,532, strictly local rates. The total local
expenditure of London for the year 1906-1907 was £24,703,087 (in
1898-1899 it was only £14,768,757), the balance of £9,761,734 being
made up by receipts-in-aid and imperial subventions. This expenditure
was divided among the following bodies:

London County Council £9,491,271
Metropolitan Borough Councils 5,009,982
Boards of Guardians 3,587,429
Metropolitan Water Board 2,318,618
Metropolitan Police 1,903,441
City Corporation 1,270,406
Metropolitan Asylums Board 934,463
Central (Unemployed) Body 141,284
Overseers--City of London 34,757
Market Trustees (Southwark) 10,680
Local Government Board--Common Poor Fund 756
----------
£24,703,087

+----------------------------------------+-----------------------------------------+
| (1) _Rate and Debt Accounts._ |
| | |
| _Estimated Income._ | _Estimated Expenditure._ |
| | |
| Balances £967,740 | Debt (including management) £3,905,135 |
| Receipts in aid of expenditure | Grants (mostly guardians) 645,913 |
| (local taxation licences and | Pensions 75,665 |
| estate duty, beer and spirit | Establishment charges 232,045 |
| duties, &c.) 513,541 | Judicial expenses 52,515 |
| Government grants in aid of | Services-- |
| education 1,515,663 | Main drainage £295,650 |
| Interest on loans advanced | Fire brigade 263,575 |
| to local authorities, &c. 586,065 | Parks and |
| Rents, &c. 427,767 | open spaces 140,715 |
| Contributions from | Bridges, tunnels, |
| revenue-producing | ferry 49,925 |
| undertaking for interest | Embankments 14,940 |
| and repayment of debt 685,948 | Pauper lunatics 78,870 |
| Miscellaneous 3,633 | Inebriates Acts 14,045 |
| Rate contributions-- | Coroners 30,925 |
| General, for other than | Weights and measures 14,830 |
| education 2,698,610 | Gas testing 13,785 |
| For education 3,675,694 | Building Acts 25,595 |
| Special 407,946 | Diseases of Animals |
| | Acts 19,260 |
| | Miscellaneous 63,060 |
| | ---------- |
| | £1,025,175 |
| | Education 4,837,442 |
| | Steamboats 14,805 |
| | Works Dept. 12,100 5,889,522 |
| | Parliamentary expenses 22,675 |
| | Miscellaneous 6,214 |
| | ---------- |
| | Total expenditure 10,829,684 |
| | Balances 652,923 |
| ----------- | ----------- |
| £11,482,607 | £11,482,607 |
| | |
| (2) _Revenue Producing Undertakings._ |
| | |
| _Estimated Income._ | _Estimated Expenditure._ |
| | |
| Balances £4,055 | Working expenses-- |
| Receipts-- | Working class |
| Working class | dwellings £56,060 |
| dwellings £173,443 | Tramways 1,318,620 |
| Tramways 2,089,955 | Small Holdings |
| Small Holdings | and Allotments 621 |
| and Allotments 410 | Parks boating 2,965 £1,378,266 |
| Parks boating 5,100 2,268,908 | Renewals 163,828 |
| Transfers 6,214 | Reserve 44,557 |
| | Interest on and repayment of |
| | debts 685,946 |
| | Transfer in relief of rates |
| | (parks boating) 2,000 |
| | Balances 4,580 |
| ---------- | ---------- |
| £2,279,177 | £2,279,177 |
+----------------------------------------+-----------------------------------------+

The total expenditure was equal to a rate in the pound of 11s. 4.4d.;
the actual amount raised in rates was equivalent to a rate of 7s.
1.0d., receipts-in-aid were equivalent to a rate of 3s. 2.5d., and
imperial subventions to a rate of 1s. 3.4d. Practically the whole
amount contributed towards the support of public local expenditure,
and a considerable amount of that contributed to public national
expenditure is based on the estimated annual value of the immovable
property situated within the county of London, which in 1876 was
£23,240,070; in 1886 £30,716,719; in 1896 £35,793,672; and in 1909
£44,666,651. The produce of a penny rate was, in the metropolitan
police district in 1908-1909, £226,739, and in the county of London
(excluding the City) £161,806. A complete re-valuation of properties
in the county of London is made every five years, valuation lists
being prepared in duplicate by the borough councils acting as
overseers of the parishes in their respective boroughs. They are
revised by statutory assessment committees, who hear any objections by
ratepayers against their valuation. These lists when revised are sent
to the clerk of the County Council, who publishes the totals. By the
Metropolitan Poor Act 1867, the metropolitan common poor fund, to
which each union in London contributes in proportion to its rateable
value, was established. Out of this fund certain expenses of guardians
in connexion with the maintenance of indoor paupers and lunatics, the
salaries of officers, the maintenance of children in poor-law schools,
valuation, vaccination, registration, &c., are paid. The payments
amounted in 1906-1907 to £1,662,942. Under the Local Government Act
1888, the London County Council makes grants to boards of guardians,
sanitary authorities and overseers in London in respect of certain
services. This grant is in lieu of the grants formerly made out of the
exchequer grant in aid of local rates, and amounted in 1906-1907 to
£619,489. Finally, in 1894, the fund called the Equalization Fund was
established. This fund is raised by the rate of 6d. in the pound on
the assessable value of the county of London, and redistributed among
the boroughs in proportion to their population. It amounted in
1906-1907 to £1,094,946. But, in spite of attempts at equalization,
rates remain very unequal in London, and varied in 1908 from 6s. 2d.
in St Anne's, Westminster, to 11s. 6d. in Poplar. The London County
Council levied in 1909-1910 to meet its estimated expenditure for the
year a total rate of 36.75d.; 14.50d. of this was for general county
purposes, 19.75d. for education purposes and 2.50d. for special county
purposes. The preceding tables show the estimated income and
expenditure of the London County Council for 1909-1910.

Besides the annual expenditure of the various authorities large sums
have been borrowed to defray the cost of works of a permanent nature.
The debt of London, like that of other municipalities, has
considerably increased and shows a tendency to go on increasing,
although certain safeguards against too ready borrowing have been
imposed. Every local authority has to obtain the sanction of some
higher authority before raising a loan, and there are in addition
certain statutory limits of borrowing. Metropolitan borough councils
have to obtain the sanction of the Local Government Board to loans for
baths, washhouses, public libraries, sanitary conveniences and certain
other purposes under the Public Health Acts; for cemeteries the
sanction of the Treasury is required, and for all other purposes that
of the London County Council; poor law authorities, the metropolitan
asylums board, the metropolitan water board and the central
(unemployed) body require the sanction of the Local Government Board;
the receiver for the metropolitan police district that of the Home
Office, and the London County Council that of parliament and the
Treasury. The following table gives the net loans outstanding of the
several classes of local authorities in London at the 31st of March
1908:

+------------------------------------------+-------------------+
| Local Authorities. | Loans outstanding |
| | 31st March 1908. |
+------------------------------------------+-------------------+
| London County Council (excluding loans | |
| advanced to other authorities) | £49,938,131 |
| Metropolitan Asylums Board | 3,113,612 |
| Metropolitan Police (London's proportion)| 226,131 |
| Metropolitan Water Board (proportion) | 38,726,514 |
| Central (Unemployed) Body | 31,845 |
| City of London Corporation | 5,553,173 |
| Metropolitan Borough Councils | 12,551,204 |
| Guardians and sick asylum managers | 4,029,013 |
| +-------------------+
| | £114,169,623 |
+------------------------------------------+-------------------+

AUTHORITIES.--Full details and figures relating to the finance of
London will be found in the parliamentary papers _Local Taxation
Returns_ (_England and Wales_), part iv. published annually; _Returns
relating to the London County Council_, published annually; the annual
report and accounts of the Metropolitan Water Board, and the
metropolitan police accounts. The publications of the London County
Council, especially the tramways accounts, the annual estimates,
_London Statistics_, and the _Financial Abstract_ (10 years ended 31st
March 1908) have much valuable information. (T. A. I.)