Purpose of Report
To provide the Executive with an update to the current Localised Council Tax Support Scheme for 2020/21 and propose options to consult upon for a 2021/22 scheme, together with proposals in relation to an Exceptional Hardship Scheme and other Council Tax changes.
(1) That the options for public consultation in respect of the Council Tax Support Scheme 2021/22 as set out in Section 6 of the report be approved.
(2) That the continuation of the £20,000 Exceptional Hardship fund for 2021/22 to top up Council Tax Support awards in appropriate cases be approved for inclusion in the consultation.
(3) That the proposal of a premium of 300% in relation to any property that has been empty for over ten years be approved for inclusion in the consultation.
Alternative Options Considered and Rejected
Alternative options considered and rejected were set out in the report.
Reason for Decision
In order to contain the cost of the 2021/22 Council Tax Support Scheme within budget parameters of the Medium Term Financial Strategy, particularly in view of the impact of Covid-19, a number of options had been modelled as follows:
· no change to the current Scheme;
· change to the minimum weekly Council Tax support entitlement from £2, ranging from £2.50 to £4);
· reduction of capital cap from £8,000, ranging from £6,000 to £7,500;
· reduction of maximum entitlement from 100%, ranging from 80% to 97.5%;
· amendment of banding cap from B, ranging from C to D.
It was noted that of the options above, the only option likely to reduce the spend against budget in the Medium Term Financial Strategy was to decrease the maximum entitlement. For example, reducing the maximum Council Tax support customers could receive from 100% to 80% or 85% would mean they would need to then pay at least 10% or 15% of their Council Tax charge, when they had not had to pay anything previously. Based on an overall Council Tax increase of 1.9% and a Council Tax support caseload increase of 2%, this would mean on average a Council Tax payer would have to pay an additional £3.57 Council Tax per week or £2.47 per week, based on maximum entitlement of 80% or 85% respectively.
The other modelled options would reduce Council Tax support expenditure, but would still be a cost above the amount budgeted in the Medium Term Financial Strategy.