Issue - meetings

     Report by Executive Director Alistair Cunningham OBE.

Cllr Philip Whitehead, Leader of the Council, presented a report which detailed costed options for changes to the Council Tax Reduction Scheme.

The Leader explained that following the introduction of the Council Tax Reduction Scheme in 2013, it had been subject to a number of changes to bring it in line with other welfare benefits. Further changes were now necessary to improve administration and accommodate the effects of Universal Credit and these changes would require consultation.  The report set out a number of options for consultation and the Leader proposed that Option 4, detailed in the Appendix to the report, be supported for consultation, the results of which would be considered by Cabinet at its meeting in November 2019.

In response to questions from Cllr Ian Thorn, Chair of the Financial Planning Task Group, about how the consultation would be conducted and how the income ‘bands’ would operate, the Leader and Director of Finance and Procurement explained that the income bandings would be suitably flexible so that they avoided additional financial burdens on those who were part of the Scheme.

Resolved: That Option 4, as detailed below, be approved as the preferred option for consultation, with the results being reported back to Cabinet in November 2019.

Option 4

Maintain the existing scheme but offers those on Universal Credit a scheme based on the household income which offers 80% maximum entitlement but limits the number of adjustments made to the claim each year.  Entitlement will be based on a number of income ‘bands’. Those with Capital/assets of over £6,000 will not be entitled to CTR Non-Dependant deduction standardised at £4 per week.

The scheme will be designed to be cost neutral other than to include a factor for the overall increase in council tax. This proposal will mean the CTR scheme as a whole will cost approximately £24.65m in 2020-21.

Reason for Decision:

Since 2013 the Council has operated two schemes to determine entitlement to council tax reduction. There is a default scheme for those of pensionable age, Council Tax Benefit and a local scheme offering a Council Tax Reduction for those of working age. Both schemes are affected by the roll out of Universal Credit which is managed by the Department of Work and Pensions (DWP) but the most significant impact has been felt by those of working age.

The introduction of Universal Credit has had a number of effects. It has changed the relationship between the council and the claimant, who in the past relied upon the council for all their housing costs. Now Universal Credit includes housing costs for the majority of tenants, lessening both the information local authorities hold and the urgency with which customers once engaged with local authorities. It is a benefit that that can be used to top up a low income. It can be claimed by those temporarily out of work as well as those unable to work. Around one third of all households in receipt of council tax reduction are already in  ...  view the full minutes text for item 100