west*wales*news*review

West Wales News Review — analysis with a sustainability slant

West Wales (Mostly) Needs a Pay Rise

Carmarthenshire is the Welsh county with the largest  number of local authority employees paid over £100,000 a year – no less than twenty four  in 2013-14 – but the county, which some 150,000 people aged 16-plus call home, also includes  some of the lowest earners in Wales.

Median self-employment  income for income-tax payers in Carmarthenshire in 2012-13 (the latest data available) was the modest sum of £8,960, according to Her Majesty’s Revenue and Customs (HMRC). Median wage and salary income for tax-paying employees was £18,600 .

The self-employed figure quoted relates to 13,000 people, and the employee figure to 58,000, a total of around 71,000.  In addition, HMRC calculated that median pension income in Carmarthenshire was £13,100, applying to 26,000 taxpayers. Around 17,000 individuals have income from more than one of these sources, making the total number of income-tax payers in the county about 80,000.

This means that about 70,000 of the 150,000 aged 16 and over had incomes too low to be taxed. In most cases these incomes would have been less than the personal tax allowance for 2012-13 of £8,015 up to age 64, rising to £10,660 for the over 75s.

The contrast between ordinary and top incomes is stark, too stark, and not just in Carmarthenshire, where the council’s chief executive, Mark James, received a salary package of £184,473 in 2013-14, according to the TaxPayers’ Alliance.

In Pembrokeshire, the £204,795 package in 2013-14 for the then-chief executive, Bryn Parry Jones, was even further removed from taxpayers’ median incomes, which were £8,660 in 2012-13 for self-employment income, £17,300 for wages and salaries paid to employees and £12,500 for pension income.

The divide was less marked in Ceredigion, where only five council employees received more than £100,000 in total in 2013-14, and not one had a package worth over £150,000. On the other hand, median self-employment and pension incomes for taxpayers were higher than in Carmarthenshire or Pembrokeshire  – £9,330  and £13,500 respectively in 2012-13 .The median wage and salary income for employees in Ceredigion with incomes high enough to be taxed was £17,600, less than in Carmarthenshire but more than in Pembrokeshire.

The chasm between top local incomes and the great majority is bad enough – but the low level of incomes in West Wales overall is even more of a problem, and without any clear resolution unless the cost-cutting Conservative government suddenly transforms into a wealth redistributing one, which is about as likely as Earth-bound children sending presents by balloon to lonely old folk living on the moon.

PDR

HMRC’s figures are from the personal incomes series, table 3.14a, using the central estimates for median incomes. The median is the central value in a distribution, and is different from the mean, which is obtained by summing all the separate values and dividing the total by the number of instances. The mean is influenced by very high values at the top of the distribution, and so mean incomes tend to be higher than median incomes.

I have used HMRC’s central estimates. 

The TaxPayers’ Alliance published the ‘Town Hall Rich List’ on November 9th 2015.

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