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Council tax support conundrum
Happy New Year everyone. Anyone have any ideas about this query on council tax support (CTS) schemes?
Under para.42 of sch.8 of the The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 , any payments of housing benefit are expressly disregarded when assessing entitlement to CTS. These regulations cover the rules whereby a local authority decide not to set their own scheme and also set out the way that pensioners are dealt with.
Under the equivalent sch.5 of the The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 I cannot see the same disregard being applied. These regulations set out the broad statutory basis for LA’s who have set up their own CTS schemes.
Surely there’s something missing here? Can a local authority really decide to take into account housing benefit payments as income when assesssing entitlement to CTS if they have set up their own CTS scheme?
The query we’ve got actually concerns someone who only receives the housing element of universal credit so that adds another layer of complexity but am I missing something obvious in the first instance? Any thoughts gratefully received.
This is actually very careful economic drafting.
The means-testing provisions in the 2012 prescribed requirements regs only apply to pensioners. As in conventional means tested benefits for pensioners (HB, SPC) the starting point in the CTR income assessment is a closed list of items that do count so you don’t need such a long list of disregards. Para 16 of Schedule 1 to the Prescribed Requirements Regs lists the items to be included as income for a pensioner. It refers to benefits but subject to exceptions, of which HB is one. So HB doesn’t count as income in the first place which in turn means there is no need to disregard it in Schedule 5.
There are no prescribed requirements for the means-testing of working age CTR claimants so the Council can do anything it wants ... including using HB as income (although I am not aware of any schemes that do so). UC is another matter. The majority of schemes have adopted the method set out in the default scheme (in the case of authorities who use David Airey’s scheme out-of-the-box it is modified slightly to make the earnings disregards more generous). What all these schemes have in common is that the usual CTR income assessment is completely replaced by the sum of (i) the DWP’s income assessment for UC and (ii) the UC award itself, but crucially the usual CTR applicable amount is also replaced by the claimant’s max UC. If UC includes a housing element it will have the same effect on both sides of the calculation: the income is higher but so is the applicable amount.
Thanks for the swift reply Peter, much appreciated.
UC is another matter. The majority of schemes have adopted the method set out in the default scheme (in the case of authorities who use David Airey’s scheme out-of-the-box it is modified slightly to make the earnings disregards more generous). What all these schemes have in common is that the usual CTR income assessment is completely replaced by the sum of (i) the DWP’s income assessment for UC and (ii) the UC award itself, but crucially the usual CTR applicable amount is also replaced by the claimant’s max UC. If UC includes a housing element it will have the same effect on both sides of the calculation: the income is higher but so is the applicable amount.
On this point, where can I find any legislation to confirm this?
The default scheme rules on UC cases are in paras 28 and 37 of the main Schedule to the Default Scheme Regs - from the link you posted in your original comment, navigate back to the “table of contents” tab and you will find links to paras 28 and 37 under the expanded heading “Schedule: Council Tax Reduction Scheme (Default Scheme) 2013”.
While the default scheme only had force of law for one year only in a case where the Council did not make its own scheme, what happened in practice was that almost all schemes borrowed paras 28 and 37 (and as I mentioned above the off-the-shelf David Airey version added further income disregards to those default provisions). To find the law that applies in any individual local authority you need to find that authority’s full CTR scheme on its website and hunt for references to Universal Credit. You will then usually find the same wording as appears in paras 28 and 37 of the Default Scheme, subject to David Airey’s modifications.
Nice one, thanks very much again and Happy New Year Peter :-)