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Funding

Funding

We believe in the principle of voluntarism

For 100 years Derby and Derbyshire Local Medical Committee (LMC) has always believed in the principle of voluntarism and our levy has always been a voluntary one ever since our inception in 1913. Interestingly, although it has the legal power to impose a statutory levy, it has fought strenuously against invoking it.

Value for Money

The track record of the Derby and Derbyshire LMC for wise financial management is recognised throughout the LMC world in the United Kingdom. The LMC Officers seek continued support for its longstanding financial policy of maintaining at least one year’s operating costs in reserve. Derby and Derbyshire LMC was highlighted in the 2004 University of Sheffield study into the structure, function, and financing of LMCs. That study indicated that Derbyshire LMC is one of the most innovative, cost effective, value for money LMCs in the United Kingdom yet has a relatively moderate cost base. On a national level Derby and Derbyshire LMC is regarded by the GPC as being in the Premier League of LMCs for the quality of its work even though we are only medium sized.

Does the levy actually cost GPs anything in reality?

Derby and Derbyshire LMC is funded by the LMC levy. The LMC then funds its representative activities through a tightly and carefully worded service level agreement with Derby and Derbyshire LMC Ltd which is funded by the Local Medical Committee Paying LMC Ltd which is funded by the Local Medical Committee. Paying the Derby and Derbyshire LMC levy continues to be both a tax allowable expense for GPs and is taken into practice expense calculations by the NHS Employers organisation and/or the Doctors and Dentists Pay Review Body which themselves are informed by the Technical Steering Group’s (TSG) Inland Revenue practice expenses enquiry. Dr Peter Holden, Derby and Derbyshire LMC treasurer and lead member of the TSG gives a personal and categorical assurance that paying the Derby and Derbyshire LMC levy costs the profession (GPs) nothing overall. 

Derby and Derbyshire LMC levies are a fully tax allowable expense. This not only reduces the direct cost to the practice, but as LMC levies form part of expenses sampled by the Department of Health/BMA's Technical Steering Committee, will contribute, albeit in a small way, to any future increases in global sum payments.

Collection of the Levy

The method of collection is through a GP practice mandate which authorises Derby and Derbyshire LMC to collect the LMC levy on a monthly basis deduction.

Reserves Policy

It remains the policy to keep on reserve one year’s operating costs in case the current mandate system were to become disrupted or simply to ensure that there is enough funds in reserve to enable Derby and Derbyshire LMC to continue and improve its service to meet the needs of its constituents.

Increasing the levy

To increase the levy requires a resolution of Derby and Derbyshire LMC. As a matter of principle Derby and Derbyshire LMC officers prefer to give 6 month notice of an increase although it only has to give 3 month constitutionally. If and when there is a need for an increase Derby and Derbyshire LMC will look for the customary solidarity traditionally demonstrated by Derby and Derbyshire General Practice on this matter where over 90% pay the levy.

 

Please click here to view our annual reports.