Purpose

Cabinet is asked to recommend to Full Council
that:
 

(1) 
the continuation of the existing Council Tax Support
scheme for working-age residents into the 2025–2026 financial
year be approved; and

(2) 
a discretionary fund of £750,000 to support
households experiencing exceptional hardship be
retained.
 
 
 
 

Content

Cabinet:
 
(1)           
recommended to Full Council that the proposed income
banded Council Tax Support Scheme be continued whereby the maximum
award available to working aged people receiving support remains at
85% for the Council Tax billing year 1 April 2026 to 31 March
2027;

 
(2)           
recommended to Full Council that the Council
continue to make £750,000 available for a Discretionary
Hardship Fund under section 13A(1)(c) of the Local Government
Finance Act 1992 as amended by the Local Government Finance Act
2012, to offer additional help and support to those suffering the
greatest financial hardship as defined in the Discretionary Housing
Payment and Council Tax Hardship Scheme published on the
Council’s website. The current scheme is attached at Appendix
2 of the report;
 
(3)           
recommended to Full Council that there be delegated
authority to make any minor and consequential changes necessary to
the detailed provision as a result of any changes in the
regulations upon which the scheme is based, is given to the
Strategic Director of Resources following consultation with the
Portfolio Lead Member for Finance and Resources;
 
(4)           
noted that the income banded scheme treat earnings
and self-employed earnings as income to determine a households
level of income against the proposed income bands. All other income
should be disregarded;
 
(5)           
noted that the scheme will continue with two charges
for non-dependant adults within households. £20pw for those
in work & £8pw for those out of work;
 
(6)           
noted working-age residents would be entitled to
support of up to a maximum of 85%, depending on a person’s
level of income, household composition and level of capital and
whether they fall within one of the protected groups: households
with limited capability to work, households with children aged 5
and under;
 
(7)           
noted other eligible working-age residents, support
would be given up to a maximum of 57%, depending on their level of
income, household composition and level of capital;
 
(8)           
noted that the remaining provisions of the
Council’s scheme for 2026/27 will be as published on the
Council’s website;
 
(9)           
noted that the projected cost of the whole scheme is
identified as £19.53 million which is £0.93 million
more than the current scheme. This will be reflected in the
calculation of the council tax base for 2026/27 and included within
the next MTFS as part of the budget setting process; and
(10)       
noted that before any significant changes to the
scheme reducing or removing support could be made that a statutory
consultation would need to be carried out.
 

Options & Alternatives Considered

It is a statutory requirement that Council considers
and adopts a CTS scheme from 1 April 2026 and identifies the
sources of funding.

The options available to the Council for a CTS
scheme from 1 April 2026 are to continue with the existing scheme
or design and consult on an alternative, either less generous or a
more generous scheme. Before any significant change can be made to
the scheme there is a legislative requirement to undertake a full
consultation with residents, the GLA and other stakeholders.
Legislation dictates that the Council must decide on a scheme by 11
March but as the cost of the CTS scheme forms part of the budget
setting process and Council Tax annual billing, approval for a new
scheme would need to be made by 31 January 2026. Given these
timescales, there may be insufficient time remaining to undertake a
meaningful consultation and obtain approval for a new scheme to
commence from 1 April 2026. Adopting a significantly different
scheme without following the statutory requirements to consult
would be unlawful.

It is recommended that the Council continue with the
current income banded scheme to help protect the most vulnerable
residents in the borough whilst also maintaining a sure financial
footing for the Council.