CT benefit: consultations on new schemes for local areas

The toolkit area has a good list of links to local council consultations on how they should do the government’s dirty work and implement the 10% CT budget cut as fairly as possible.

What is missing, though, is any blueprint of what advisers think would be the best thing to try and persuade councils to do.

Most councils appear to be either supplementing the CT rebate budget from other areas or imposing an across the board 20-25% cut on working age claimants. The simplest way of councils doing this is clearly to just carry on as they are but to say that those under PC age will only have 75% of their CT bill put into the calculation. But are there choices?:

Billing: Many councils are looking at the changes they are now allowed to make to CT billing such as increasing charges / scrapping discounts for empty properties, second and holiday homes. People responding to CT rebate changes may not realise there are separate consultations on these which might help.

Rebates: some proposals for saving money which might be fairer than everyone below PC age having a 25% cut:

•  Scrap 2nd adult rebate: apparently its costly and time consuming to work out (+ ongoing upgrade software implications), but it only helps a few people and those are well off people
•  Take maintenance, war pensions and some other ignored income into account, or only disregard a small amount
•  Get rid of the 26 weeks delay in charging NDD for pensioners when a ND moves in
•  Curtailing the automatic temporary absence rules (in line with their policies on empty homes discounts) so that UK / hospital /trial time in care ones are shorter initially but with scope to extend easily; also shorten temp absence abroad rules, again with discretion.

Any thoughts?

But won’t across the board cuts conflict with DCLG guidance that revised scheme should take account of ‘vulnerable groups’ and not undermine ‘work incentives’. That must leave ‘across the board’ schemes open to challenge and possible judicial review?

I think only some sort of across the board cut could make the required savings, unless there is going to be a reduction in council spending. Our council might be making other cuts on top, eg removing Second Adult Rebate and child maintenance disregards, etc, but looking at the numbers, the main saving will have to be from some sort of limiting of benefit. In our area, probably to 65% of the bill, because of the relatively high number of pension age claimants.

Perhaps I shouldn’t really comment though - our national body says about the CTS consultations: “Bureaux should not be involved in setting entitlement criteria – It wouldn’t be appropriate for bureaux to lobby for this or that claimant group to be advantaged over others.  But it will be important to watch out for proposals which discriminate unlawfully or particularly harshly against certain population groups”. I expect other agencies will take a different view.

Regarding a JR challenge, I would guess it’s possible to “take account of” vulnerable groups or of earners, without doing much more than retaining the current system of premiums and disregards?

If you’re looking at ways to challenge the process of CTS scheme development, I would look most carefully at the impact assessments which may be seriously flawed ( if the ones I’ve looked at are any guide).

The real problem of course is identified in Jana’s initial e-mail.

The Government has imposed the 10% cut and there is nothing Councils can do about it. The discussions are all around who gets a reduced service or pays more Council Tax as a consequence.

Increasing CTAX on 2nd homes sounds good, but for most Councils the numbers are small the amount of money involved no where near enough to cover the 10% cut.

Empty property’s sounds good, but it will not apply to many Housing Associations (who can just claim a cat B exemption instead) and smaller landlords will probably compensate by sticking up the rent they charge on their properties at a time when HB is being cut. So claimants might well bear the brunt of that change anyway.

The structure of Council Tax is such that if all claimant’s are protected from the cut, most of the costs of that will fall on pensioners and people working on a low income who live in band C&D properties but have income too high for benefit entitlement. Although the numbers of these people are larger than the numbers on benefit so the impact on each individual is less.

Rightly or wrongly the predominant mood of the majoprity who do not get benefit is that most of the cuts should fall on the unemployed and that is what is often coming out of the public consultations. However ill informed you might think that view is, local Councillors don’t have much choice but to listen, at least partially, to the results of these public consultations. 

In my Authority around half the cuts will be passed on to claimants and around half found from other sources which may include the technical reform to Council Tax assuming we get the legislation in time.