Parking income critical for investment, says City Council

Exeter City Council has criticised the Government and the RAC Foundation for misleading tax payers over the collection and expenditure of income from parking. This comes in response to an RAC Foundation report released today that says the vast majority of local authorities in England generate a surplus from their parking charges. The release of the data also follows government figures, released on Wednesday, showing that English councils' income from parking charges and fines is likely to continue to rise.

Local Government Secretary Eric Pickles said: "This municipal parking profit shows why we need to review and rein in unfair town hall parking rules. The law is clear that parking is not a tax or cash cow for town hall officers."

However, Exeter City council maintains that "Parking income has become increasingly important to councils in the face of relentless cuts in government funding - Exeter City Council's funding has been slashed by 27% over the last four years."

A recent court case involving Barnet Council is being used to support the claim that income from parking can only be spent legally on a limited number of areas, such as road maintenance. However City Council officials argue that the Barnet case relates to income gained from on-street charges and penalties and not income from car parks.

Cllr Rachel Sutton, Lead Councillor for Sustainable Development and Transport, said: "To call parking surpluses a profit and to refer to them as illegal shows how little the government understands or cares about local services. Profit goes into private pockets. In Exeter, car park income is reinvested in high-quality services and facilities. We invest £4m in the city centre each year on things like CCTV, toilets, street cleaning, tourism, parks and gardens and the Royal Albert Memorial Museum - all of which benefit residents, businesses and visitors alike.

"It is only right that the costs of providing facilities and amenities should be shared by those that use them, rather than just being subsidised by Exeter's council tax payers. Without parking income, the total amount of council tax raised by the City Council would need to increase by 70%."

Pricing of car parking also has an important role in transport management to achieve a balance between encouraging public transport, easing congestion and supporting the needs of business. If parking is too cheap, and demand outstrips supply, there is potential for gridlock.