Policy & Resources Cabinet Member – Minutes – 2 August 2012

11  (11)  BUSINESS MILEAGE RATES – The Director of Policy and Resources submitted a report seeking approval to reduce the rates paid for business mileage, remove the essential user lump sum, to introduce standard HMRC tax-exempt payments, known as ‘approved mileage allowance payments’ (AMAPs) for both essential and casual users and sought approval for revisions to the council’s Allowances and Expenses policy.

The council had a savings target of around £25 million to achieve by 2014/15.  The focus of this target was to avoid reductions in service delivery and to minimise job losses and to support this all areas of council expenditure had been carefully examined, with one of these areas being a permanent reduction in employment costs.In 2011/12 the council spent approximately £1.7 million on casual and essential user mileage.  Whilst other options such as weekend enhancements and overtime rates had been considered, changes were being proposed to business mileage rates as it was considered that this would not only result in significant savings but a much greater equity in how the council paid its employees for business mileage.

It was acknowledged that changes to casual and essential user car allowance would impact on staff, however, it was noted that the NJC mileage allowances were subject to tax whilst the proposed HMRC rates were tax-exempt.  The trade unions had balloted their members on the proposals and the results were set out in paragraph 7.1 of the report.

Resolved – That the proposed reductions to business mileage, alongside the revisions to the council’s Allowances and Expenses policy be approved and implemented in accordance with further legal advice.