Agenda item

Report of the Cabinet Member Finance

The Cabinet Member Finance introduced the report and explained that in April 2013 the council introduced its local council tax support scheme. She explained that council tax support for pensioners was not localised and continued to be provided for by a national scheme and in Cheltenham there were approximately 2,400 of pension age.

She explained that council tax support was given to around 6,000 households in Cheltenham at an annual cost of just under £6m. This included working and pension age claimants. Approximately 60% (3600) of those households were of working age. The cost of the council tax support scheme was met by this council and the precepting authorities.

The Cabinet Member reported that based on 2017/18 data, CBC was one of 37 councils out of 326 whose local council tax support scheme had not been amended to date to reflect reduced government funding.

The Cabinet Member then went on to explain that Cheltenham became a full Universal Credit area in January 2018. As the number receiving Universal Credit increased, the administration of calculating local council tax support entitlement became greater. This was because Universal Credit was reassessed on a monthly basis and any changes in income would mean that a different level of income needed to be taken into account for assessing council tax support. A change in the level of council tax support, however small, meant that a revised council tax bill needed to be issued. Issuing revised bills on a monthly basis was not sustainable for this authority or for those in receipt in managing their budgets.

The Cabinet Member informed Members that a consultation exercise on proposals for a revised council tax support scheme for 2019/20 was undertaken from 25 July until 9 September 2018 and was widely promoted. 130 people responded to the consultation which was considered a good response when compared to some other councils. Consultation was also undertaken with Gloucestershire County Council, Gloucestershire Police and the parish councils. The responses to the consultation had been analysed as outlined in appendix 3. Together with the income and household composition of the current council tax support caseload, these responses had been used to design the proposed scheme which was summarised in appendix 2.

The Cabinet Member explained that the income bands set the percentage discount to be awarded based on the level of household income. The overriding aim of the scheme was to:

Protect the most vulnerable individuals and families by continuing to provide 100% support to those on the lowest income

Provide some financial support to low income individuals and families, based on their level of income

Minimise the number of changes to the amount of support awarded and therefore the amount of council tax payable due to monthly Universal Credit reassessments

Reduce the overall cost of the scheme to the taxpayer

The scheme would be based on 5 income bands with the highest band providing support at 100% of the council tax liability, then reducing to 80%,60%,40% and 20% as household income increased.

Once the scheme was approved by Council the Revenues and Benefits team would notify all those claimants who would be affected by the change to make them aware that they would face an increase in council tax in 2019/20. When council tax bills were issued in March next year further letters would be sent with bills to explain payment options.

The Cabinet Member referred to the Equality Impact Assessment for the proposed scheme in appendix 4.This had been undertaken once the consultation had finished and analysed at which time the proposed scheme was designed.

The Cabinet Member Finance believed that adopting this scheme would reduce the support provided to some claimants, but would protect the most vulnerable. She proposed that there should be a hardship scheme to support those most affected and highlighted that a reduction awarded under this policy would be wholly discretionary and the only requirement would be that the Council must consider each case on its own individual merits. The full cost of awarding any reductions would be met by the  General Fund. The Council must therefore balance the need of the individual council payers requiring support against the interests of the council tax payers generally.  The Cabinet Member explained that arrangements had been made with Gloucestershire County Council for them to contribute to reductions awarded under this policy to those affected by the changes to the local council tax support scheme.

The Cabinet Member wished to highlight the following :

·         Over two thirds of working age customers would see no change to their entitlement

·         100% protection would continue for the most vulnerable of customers with the lowest incomes

·         Child benefit and child maintenance payments would not be taken account of  in the calculation of household income

·         Child minding fees of up to £175 per week for one child and up to £300 per week for two or more children were disregarded from a person’s income (subject to further conditions)

·         An additional disregard where a person has a disabled child or children had been introduced

·         Personal Independence Payment and Disability Living Allowance was ignored for all members of the household

·         No non dependant deductions where the claimant or partner were in receipt of Personal Independence Payment or Disability Living Allowance

·         The Revenues & Benefits team would work closely with customers in the new year preparing them for the changes

·         Customers would be invited to pay their council tax instalments over 12 months instead of the statutory 10

·         A visiting officer would be made available for welfare visits on request

·         There would be closer working and liaison with CBH where tenants were affected by the changes

·         Provision of personal budgeting and support by CCP for the year 2019-20 to support customers through the transition

·         Close monitoring of council tax accounts and identification of people struggling to pay who have been affected by changes

·         A new Discretionary Hardship Relief policy to support those with extraordinary circumstances

·         Less revision of awards and council tax instalments for Universal Credit recipients in receipt of CTS

Finally, the Cabinet Member wished to put on record her thanks to all those who had responded to the consultation and paid tribute to officers for the significant work they had undertaken.

Members made the following points :

Assistance for the most vulnerable, particularly those on universal credit was welcomed. Concern was expressed in view of the no child left behind agenda where children were in working households who were not necessarily eligible for benefits. It was requested that officers provided advice and support where this was being brought to their attention so that no child would be disadvantaged as action hadn’t been taken. It was important that there was cross portfolio working to ensure the council supported the most vulnerable. The Cabinet Member Finance explained that this issue had been raised with officers. It was not possible to allocate the hardship fund specifically to those mentioned due to the awareness that a number of people were affected. However, she committed to ensure that the no child left behind agenda was at the fore as decisions were taken going forward.

Members welcomed the fact that to date CBC had retained the level of council tax support within a reasonably progressive set of scheme rules. Whilst recognising that the changes were small they could be significant to those individuals in need who were the most vulnerable.

Reference was made to feedback during the consultation regarding the equality impact assessment. The Cabinet Member Finance explained that this was carried out at the stage the proposed scheme was designed, i.e. subsequent to the analysis of the results of the consultation.

 In response to a question as to whether this constituted a family friendly policy the Cabinet Member explained that the council had done all it could to mitigate the effects of universal credit. This represented a logical time to make changes.

RESOLVED (unanimously) THAT

1.    the Local Council Tax Support Scheme for working age customers for 2019/20 in Appendix 2 be approved, in accordance with section 13A(2) of the Local Government Finance Act 1992

2.    the Discretionary Hardship Relief Scheme in Appendix 5 be approved, in accordance with Section 13A(1)(c) of the Local Government Finance Act 1992

3.    Decisions relating to the application of Section 13A(1)(c) Hardship Relief Scheme awards be delegated to the Head of Revenues and Benefits.   In the case of a dispute a reconsideration is to be made by the Executive Director Finance and Assets in consultation with the Cabinet Member Finance