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Local Council Tax Support Scheme - 2019/20

Date of consultation: Monday, August 6, 2018 - Friday, September 14, 2018

Consultation summary

The current Council Tax Support Scheme will end on 31st March 2019 and, from 1st April 2019, Councils will put in place (if necessary) a new local Council Tax Support scheme.  

Stroud District Council is asking residents, the major precepting authorities (Gloucestershire County Council and Gloucestershire Police and Crime Commissioner) and key stakeholders, for their views on Council Tax Support and options to update the current scheme.

There are nearly 3,000 working age claimants in the district who receive Council Tax Support. Many are unemployed or unable to work and will receive 100 per cent Council Tax Support meaning that they do not pay any council tax. Other recipients receive Council Tax Support based on the income they have.

We currently allow all working age people to claim up to 100 per cent support towards their Council Tax, depending on their income and household circumstances and have maintained that level of support since 2013, despite the reduction in government funding. Nationally, just 37 councils continue to provide this support.

Further background information

The Welfare Reform Act 2012 abolished Council Tax benefit. Under the Local Government Finance Act 1992 local authorities are required to develop a local Council Tax Support scheme which protects pensioners.

All of the Gloucestershire districts have adopted the “default scheme” since 2013/14 (apart from Cotswold DC 8.5% reduction) which basically mirrors the previous Council Tax Support scheme and has meant no changes. All the Gloucestershire Districts are currently consulting on a scheme for 2019/20. 

Council Tax Support for pension age customers can not be reduced.

As the billing authority, we must consult any major precepting authority such as Police and Crime Commissioner and Gloucestershire County Council. We should also consult such other persons that are likely to have an interest in the operation of the scheme such as Citizens Advice and other support agencies.

The consultation is about changes to the Council Tax Support scheme for 2019-20.  We are eager to hear the views of a cross section of people across the Stroud District.

Local Council Tax Support Scheme - 2019/20 consultation

Option 1 - Introduce an income banded scheme

We currently carry out a means test and compare the applicant’s income to a range of allowances and premiums set annually by central government. The lower a person’s income the more Council Tax Support they will receive. However every change of income results in an adjustment to the applicant’s Council Tax Support which then generates a revised Council Tax bill with different instalments to pay.

Introducing a scheme based on income bands would avoid multiple changes to the amount of Council Tax Support and therefore reduce the number of Council Tax bills issued throughout the year, providing the income remained in the same income band.

This will be less confusing for Council Tax payers receiving Council Tax support, particularly those who receive Universal Credit, as their income is reassessed by the DWP every month. This currently results in a reassessment of their Council Tax Support, despite how small the change is. 

It is a clear and simple change to the current scheme, potentially making administrative savings and it would help people budget over longer periods.

Option 2 - Introduce a banding scheme which protects applicants on passported benefit

This local scheme will use a person’s income to decide how much discount to apply to their council tax liability.

For those claimants on passported benefit (Income support (IS), Job Seekers Allowance (JSA), Employment and Support Allowance (ESA)) they will continue to receive 100% Council Tax Support.  Adopting this scheme will ensure we continue to protect the most vulnerable of claimants enabling them to still receive that maximum support.

The amount of Council Tax reduction that a working age customer receives is based on the amount of income that they and any partner receive. This will place the customer in an income band, and the band will determine the amount of support that a person is entitled to.

This option will mean those working age claimants not on a passported benefit will pay a minimum of 20 per cent with a differing band and percentage to pay, depending on income. Reducing this support would mean that some working age applicants would need to make payments whereas they do not currently have to.

Option 3 - Introduce a banding scheme where all working age applicants pay a percentage of the charge

We currently allow all working age customers to claim up to 100 per cent support towards their Council Tax, depending on their income and household circumstances.

This option would require all applicants who claim Council Tax Support to pay a minimum of 20 per cent with differing banded and percentage to pay, depending on income. Reducing this support would mean that some working age applicants would need to make payments whereas they do not currently have to.

We are mindful that any minimum payment should be affordable given the household’s circumstances so that we will be able to collect payments due.

Option 4 – Do nothing and continue to apply the Governments default scheme

This option does not address the shortfall in funding, but continues to provide up to 100% support.

The working-age case count and subsequent cost to the authority of the local scheme has been reducing.

If there was an increase in case count, due to a slowdown in the economy (either as a result of the general economic cycle or the impact of Brexit), the cost to the authority of maintaining the existing levels of support would increase.

Give us your views Local Council Tax Support Scheme - 2019/20

If you have any feedback regarding the Local Council Tax Support Scheme - 2019/20 consultation, please email: benefit.services@stroud.gov.uk

We will use the information collected from this consultation to help make our decision on the changes to the Council Tax Support scheme from 1 April 2019.

The results from the consultation will be published here later this year.

Work will take place to design a revised Council Tax Support scheme which will be considered as a full council meeting in October 2018. The scheme will then be reflected as a discount on Council Tax bills for 2019/20.

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