Decision Maker: Cabinet

Outcome: Recommendations Approved

Is Key Decision?: No

Is Callable In?: No

Date of Decision: December 3, 2024

Purpose: Cabinet is asked to recommend to Full Council that the proposed scheme outlined in the report is adopted as the Council’s Scheme for Council Tax Support from 1st April 2025.    

Content: Cabinet: (1)            considered the consultation documentation, outcome analysis from the consultation on the council’s preferred scheme, Greater London Authority (GLA) Consultation response and Case study models of impact of recommended scheme at Appendices 1, 2, 3 and 6 of the report; (2)            recommendedto Full Council that the proposed income banded Council Tax Support Scheme consulted upon be adopted whereby: ·       working-age residents are entitled to support of up to a maximum of 85%, depending on a person’s level of income, household composition and level of capital where they fall within one of the protected groups who are households with limited capability to work and households with children aged 5 and under; ·       other eligible working-age residents are entitled to support up to a maximum of 57%, depending on their level of income, household composition and level of capital; ·       the reductions made to support for non-dependants will be a reduction of £20 per week for working non-dependants and £8 per week for non-dependants who are out of work; (3)            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. This includes supporting care leavers; (4)            recommended to Full Council there be delegated authority to correct any accidental errors and make any minor or consequential changes necessary to the detailed provision as a result of any changes in the regulations upon which the scheme is based, to the Strategic Director of Resources following consultation with the Portfolio Lead Member for Finance and Resources; (5)            noted that the income banded scheme treats earnings and self-employed earnings as the only income used to determine a household’s level of income against the proposed income bands. All other income would be disregarded. The scheme will continue to fully disregard War Widows & War Widowers pensions for all applicants. Various other incomes, for example, Child Benefit, Disability Living Allowance and Personal Independence Payments will also continue to be ignored when calculating entitlement to Council Tax Support; (6)            noted that the remaining provisions of the Council’s scheme for 2025/26 will be as published on the Council’s website; (7)            noted that the projected cost of the whole scheme is identified as £18.31 million which is £2.3 million less than if the current scheme is continued. This will be reflected in the calculation of the council tax base for 2025/26 and included within the next MTFS as part of the budget setting process; (8)            noted that before any significant changes to the proposed scheme reducing or removing support could be made that a further statutory consultation would need to be carried out; and (9)            recommended to Full Council that the Council conducts a more detailed analysis of households' ability to meet these liabilities based on the administrative data the Council has access to using platforms and methodologies for reliable analysis. This recommendation is welcome and reflects existing practice, and whether the proposed changes are accepted or not the authority will use its tools such as Pathways, Destin Solutions, and LIFT to identify the ability of households to meet liabilities and address this through the existing hardship fund and income maximisation.   Options & Alternatives Considered It is a statutory requirement that Council considers and adopts a CTS scheme from 1 April 2025 and identifies the sources of funding. It is recommended that Cabinet recommends that Full Council adopt the proposed income banded scheme to help protect the most vulnerable residents in the borough whilst also maintaining a sure financial footing for the Council. Members should be aware that there are also other options available to Full Council for a CTS scheme from 1 April 2025. Cabinet could recommend to Full Council that it adopts a more generous scheme than consulted upon such as continuing with the existing scheme, which would cost £20.61million and see the average award increase by £1.00 per week. The scheme would cost £2.32million more than the proposed scheme. The Council can also choose not to adopt a scheme, in which case it will be required to calculate amounts of support using the Government’s ‘default scheme’.This is more generous than any of the schemes previously adopted and gives the Council no control over its content. The Council may decide to adopt a more generous scheme than it has consulted on however, for example changes to income bands to increase the levels of income within the bands, this would require the Council identify how it would be funded, for example, from use of Council Reserves or monies from other service budgets. Designing a less generous scheme than the one consulted upon would require consultation.  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 2025/26 is set in February 2025. Adopting a significantly different scheme to that currently operated or consulted upon offers system implementation challenges, so it is urged that a decision be made at the earliest convenience to minimise risk of incorrect Council Tax billing.