To consider the Council’s draft policy on localised Council Tax support.

The Deputy Leader and Executive Member for Corporate Resources delivered a presentation, which provided the Committee with details of the draft policy on localised Council Tax support. Specifically, the presentation covered:-

·        National government policy regarding the changes;

·        Details of the current system of Council Tax Benefits;

·        An explanation of localised Council Tax support;

·        Statutorily, what the Council must do;

·        The 4 principles behind the draft Central Bedfordshire scheme;

·        The critical aspects of the draft scheme in terms of protected groups;

·        The communications policy and communication thus far; and

·        Key risks and mitigating actions;

Members of the Committee raised a number of concerns during the presentation regarding the following issues, which were all comprehensively debated by attendees:-

·        The financial impact the draft scheme would have on Town and Parish Councils. The Executive Member confirmed that following further government consideration of this issue, and subsequent revision to the Local Government Finance Bill, no financial impact was now expected. In essence, Town and Parish Council precepts would be calculated as they had been in the past by using a protected tax base;

·        The financial impact the introduction of the draft scheme would have on Central Bedfordshire Council and the difficult decisions the Council would have to make regarding management of the funding shortfall of circa £2.5M per annum;

·        The flexibility available to the Council to amend Council Tax discounts and exemptions according to local circumstances;

·        The protection of groups such as pensioners and other vulnerable people (lone parents with children under 5, carers, those with disabilities and those in receipt of war widows or war disablement pensions), who would be exempt from any contribution; and

·        The ability of other working age benefit claimants to make a 25% contribution to Council Tax from an already very low income base.

Whilst the Committee supported the four principles upon which the draft policy was based and acknowledged the difficult financial and moral position the Council found itself in, it nonetheless expressed considerable concern about the detrimental impact it would have on those working age benefit claimants not designated as vulnerable (and therefore protected from the need to make a contribution) such as those persons in receipt of Jobseeker’s Allowance and Employment & Support Allowance (Work Component). It was Members opinion that these people, who were perhaps least able to make a contribution, would suffer considerable hardship as a result of the introduction of the draft scheme.

The Committee therefore debated the merits and demerits of exempting those persons in receipt of Jobseeker’s Allowance and Employment & Support Allowance (Work Component) from making any contribution at all (or a lesser contribution than the 25% proposed), with the subsequent shortfall in funding being met from the identification of further efficiencies as part of the budget setting process, increases in fees and charges generally or as a last resort, by increasing Council Tax.

During the debate, Members considered issues such as:

·        The administrative cost of collection and the diminishing returns that would arise should smaller contributions, such as 5%, be proposed;

·        The potential increase in debtors as a result of the introduction of the draft scheme;

·        The government’s default scheme, which was quickly dismissed;

·        The claimant Appeals process that would be introduced to manage individual cases of severe hardship;

·        The lack of financial or statistical information regarding the impact of any proposed amendment to the draft scheme; and

·        The current recession and economic climate generally, and unemployment rates in Central Bedfordshire.

In conclusion, the Committee unanimously agreed to forward a clear statement of concern to the Executive regarding the detrimental impact the draft scheme will have on those persons in receipt of Jobseeker’s Allowance and Employment & Support Allowance (Work Component), and request it to consider exempting such persons from having to make any contribution at all, with the subsequent funding shortfall being met from the identification of efficiencies as part of the budget setting process, increases in fees and charges generally or as a last resort, by increasing Council Tax. In recognition of the current economic climate however, the Committee further agreed to such exemption being applied on a temporary basis until such time as the recession ended.

Finally, the Committee and Executive Member wished to record their thanks for the hard work of the Head of Revenues & Benefits and his team in preparing the draft scheme under difficult and changing circumstances, and against tight deadlines.

RECOMMENDATIONS:

1. That a clear statement of concern be forwarded to the Executive regarding the detrimental impact the draft Council Tax Support Scheme will have on those persons in receipt of Jobseeker’s Allowance and Employment & Support Allowance (Work Component);

2. That the Executive considers exempting temporarily, until such time as the recession ends, those persons referred to in (1) above from having to make any contribution at all, with the subsequent funding shortfall being met from the identification of efficiencies as part of the budget setting process, increases in fees and charges generally or as a last resort, by increasing Council Tax.