Figures revealed this week show Harrogate Borough Council as being among those paying their staff more than the nationally approved mileage rate for using their own cars.
A pressure group has branded the situation a “needless waste of taxpayers’ money”, with HBC said to be paying more than the HM Revenue and Customs approved allowance of 45p.
Figures from the Taxpayers' Alliance originally claimed that the council is paying out 55p a mile, but leader Richard Cooper said the overall amount paid out in mileage to employees dropped by 10 per cent in the last full financial year.
The Taxpayers’ Alliance has accused councils paying above the rate of paying staff “by the back door.” A report in 2011 first highlighted the issue nationally, prompting some local authorities to cut their rates.
But the Alliance said: “Too many still pay more than they should, costing taxpayers millions. Reducing mileage payments to the approved rate is an easy way of saving money without affecting frontline services.”
The organisation said councils paid £223m in mileage to their employees in 2016-17, at an average rate of 48.92p a mile - 3.92p higher than the approved rate.
Harrogate Borough Council said its allowance was agreed with staff in 2013 as part of changes to their terms of employment.
The leader of Harrogate Borough Council, Richard Cooper, said: "We value our employees and all those who work in the public sector. That is why we want to make sure that those who run our vital public services have good employment conditions and are rewarded for the work they do.
"This work includes keeping our district beautiful, making sure our restaurants and takeaways are of the top standard, collecting and recycling our waste and making sure that the poorest in our society are housed, receive benefits and are supported getting in to a job.
“I am sure were we to pay rock bottom for everything then we would not be able to recruit the dedicated people who give us award winning parks and gardens, who teach our children to swim and who provide support for the many charities and community groups in our district."
Across the country, council workers were said to be on average £50.29 better off over 1,000 miles than workers whose employers paid the approved rate.
John O’Connell, chief executive at the Taxpayers’ Alliance, said: “There’s no excuse for councils to pay more than HMRC’s approved rate for mileage.
“It’s simply not credible for local authorities to plead poverty and raise council tax while paying over the odds for basic expenses, especially when the government has been telling them to rein in these payments for the past five years.”
North Yorkshire County Council, which pays its staff only 42p a mile, said it has reduced mileage spending by £100,000 in the last couple of years.