Purpose

Cabinet is asked to recommend to Full Council
that the proposed scheme outlined in this report is adopted as the
Council’s Scheme for Council Tax Support from 1 April
2024.

Content

Cabinet:

(1)         
recommendedto Full Council that the current Council Tax Support
Scheme continues whereby the maximum award available to working
aged people receiving support remains at 85% for the Council Tax
billing year 1 April 2024 to 31 March 2025;

(2)         
recommendedto 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 2023/24 scheme is attached at Appendix 2 to
the report;

(3)         
delegated responsibility 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)         
agreed that, like Housing Benefit, the scheme will continue to
fully disregard War Disablement,War Widows & War Widowers
pensions for all applicants.  Other
incomes, for example, Child Benefit and disability benefits such as
Personal Independence Payments will also continue to be ignored
when calculating entitlement to Council Tax Support;

(5)         
notedthat the remaining provisions of the Council’s
scheme for 2024/25 will be as published on the Council’s
website;

(6)         
noted that the projected cost of the whole scheme is
identified as £19.92 million which is £1.632 million
more than the 2023/24 MTFS provision. This will be reflected in the
calculation of the council tax base for 2024/25 and included within
the next MTFS as part of the budget setting process. The additional
£1.632 million needed to fund the scheme will come from
dedicated earmarked reserve of recovered housing benefit
overpayment debts; and

(7)         
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 2024 and identifies the sources of funding. It is recommended
that the Council continue with the current scheme and that the
additional £1.632 million funding required to do so is funded
from dedicated reserves.

Members should be aware that there are also other options are
available to the Council for a CTS scheme from 1 April 2024. The
choices available are to continue with the existing scheme as
recommended or to design and consult on an alternative, either less
generous or a more generous scheme.

A less generous scheme option the Council could choose is to return
to the previous scheme that was operational between 2017/18 and
2022/23 in which maximum CTS award was capped at 76% of liability.
This would mean that working aged households would be required to
pay at least 24% of their Council Tax themselves instead of the
proposed 15% contribution. The estimated cost of this option is
£18.603 million, which is £315,000 more than the
£18.288 million identified in the MTFS for 2023/24 and
£1.281 million lower than the proposed scheme.

This option is not recommended because of the continuing cost of
living crisis and the number of households in the borough suffering
from food and fuel poverty. Any reduction in the CTS support level
would diminish the financial resilience of affected households even
further.

The Council could alternatively consider making the scheme more
generous, potentially increasing support up to 100% for working
aged households. However, to do so would require the Council to
find a minimum of £3.6 million additional funding and to
identify how it would be funded, that is; through service
reductions, increasing Council Tax beyond the government permitted
levels triggering a referendum or, in the short term, by using
reserves and would not address the on-going financial requirement.
This option is not recommended as the current MTFS is forecasting a
funding gap in 2024/25 and 2025/26, and reserves could be required
to manage some of this gap whilst longer-term solutions are
identified.

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 each year, 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 the date the budget for 2024/25 is set in
February 2024. Adopting a significantly different scheme without
following the statutory requirements to consult would be
unlawful.