Consultation on changes to the working age Council Tax Reduction Scheme.
This consultation is closed and ran from 24 August to 13 October 2017.
We considered whether to make further changes to the working age Council Tax Reduction Scheme (CTRS) with effect from April 2018 and wanted to hear your views on the proposals.
Pensioners will not be affected by these changes because a central government scheme with national rules determines the levels of support to be provided for all pension age applicants.
For you to be treated as a pensioner when you claim CTR, you must meet both the following conditions:
- You must have reached the age for getting Pension Credit
- Neither you nor your partner must be getting Income Support, income-based Jobseeker's Allowance, income-related Employment and Support Allowance or Universal Credit
Any information you provided will be treated as strictly confidential and will only be used for the purposes described here and will not be shared with any other parties. Any comments provided may be included in anonymous form in the published results.
If you have any queries, need help to complete the questionnaire or would like it in another form or language please call 01432 260443 or 01432 260268 or email firstname.lastname@example.org
There will be no changes to the scheme.
In April 2013 central government changed the system for providing assistance to those on a low income to pay their Council Tax. The localised CTRS introduced by each council replaced the previous national Council Tax benefit system. The CTRS is reviewed annually and the council must have a scheme ready by 31 January each year to commence on 1 April of that year and must consult on changes to the scheme.
In April 2013, the first year of the local scheme, the government provided additional funding for the CTRS based on a maximum level of 91.5 percent subsidy. This ensured that claimants had a minimum liability to pay 8.5 percent of their Council Tax charge.
From April 2014, this additional government funding ceased and following consultation Herefordshire Council decided it would award Council Tax Reduction (CTR) up to a maximum level of 84 percent subsidy of an applicant's Council Tax charge, meaning that anyone of working age would have to pay at least 16 percent of their Council Tax. A Council Tax Band D restriction was also introduced which meant that council taxpayers responsible for a property rated above band D would receive CTR capped at a maximum level of 84 percent subsidy of the Council Tax charge on a band D equivalent property.
From April 2015 Herefordshire Council decided the CTRS would remain the same as in the period April 2014 to March 2015.
From April 2016 to March 2018 following consultation a two year CTRS was agreed by Herefordshire Council who decided it would retain up to a maximum level of 84 percent subsidy for protected groups, these being applicants in receipt of severe disability premium, applicant in receipt of carers allowance and households with a child under five years of age, meaning that anyone falling into a protected group would have to pay at least 16 percent of their Council Tax charge. All other working age applicants would be awarded up to a maximum level of 80 percent subsidy, meaning that they would have to pay at least 20 percent of their Council Tax charge. A capital limit was introduced, meaning that an applicant with capital of £6,000 or more would not be entitled to (CTR). A Council Tax band C restriction was also introduced which meant that council taxpayers responsible for a property rated above band C would receive CTR capped at a maximum level of 84 percent subsidy (protected groups) or maximum level of 80 percent subsidy for all other working age applicants, of the Council Tax charge on a band C equivalent property.
Herefordshire Council maintains a discretionary hardship scheme for people facing financial difficulties in paying their Council Tax. The scheme will be enhanced for 2018/19 following the outcomes of this consultation.
What would changes to the current scheme mean for people in Herefordshire?
The level of support for pensioners will not be affected because central government has decided that any new scheme cannot change the eligibility rules or the amount of support pensioners receive.
For claimants of working age, the council is considering changes that could reduce the level of support given from 1 April 2018.
Working age applicants who currently qualify for CTR will be affected by the changes, as they could have greater liability from April 2018. The amount of Council Tax they will have to pay will depend on their income, but everybody will have to pay something.
We are committed to ensuring that support continues for our most vulnerable residents and we are seeking your views on how the proposed changes will affect different groups of people.
What are the proposed changes for working age council taxpayers from April 2018?
- Retain the existing CTR maximum level of 84 percent subsidy for "protected groups" and maximum level of 80 percent subsidy for all other working age claimants.
- The level of CTR subsidy discount to be based on income bands - This proposal would see working age claimants in the current "protected group" continue to pay at least 16 percent of their Council Tax bill. Working age claimants in the "vulnerable group", these being claimants who are in receipt of income support, job seekers allowance (income based) and employment and support allowance (ESA), the new personal independence payment (PIP) and families who have children who are in receipt of disability benefits, paying at least 20 percent of their Council Tax bill, and for all other working age claimants payments would vary according to their income band range. An example of the income bands and maximum level of subsidy awards appropriate to the band range are:
|Income band||Weekly income range £||CTR maximum subsidy percentage|
|1||Protected group - severe disability premium/carers allowance/families with children under 5||84%|
|2||Vulnerable group - Income Support/JSA (IB)/ ESA (work related and support components) /PIP/families with children in receipt of disability benefits||80%|
|3||0.00 to 80.00||75%|
|4||80.01 to 140.00||70%|
|5||140.01 to 200.00||60%|
|6||200.01 to 260.00||50%|
|7||260.01 to 320.00||40%|
|8||320.01 to 380.00||30%|
|9||380.01 to 440.00||20%|
- Band B restriction - to amend the current scheme from a band C restriction to a band B restriction. Under this new proposal any claimant who lives in a property above band B would have their CTR based on the appropriate maximum level subsidy discount of a band B property in their parish
- £5 minimum CTR award - restrict the minimum award of CTR to £5 and above for those claimants who fall within income bands 1 to 7 inclusive as per table in (b). If a claimant qualified for CTR of under £5 they would not be eligible for the award. The £5 minimum CTR award would not include claimants falling into the protected or vulnerable groups
- Changes in the calculation of CTR for working age claimants to align with housing benefit legislation
- Removal of the family premium for new CTR awards
- Limit the applicable amounts to two children
- Backdating of a claim to be reduced to one month from date of claim
Reason for the proposed changes
The council is facing budget reductions and must deliver substantial savings to set a balanced budget.
Published: Thursday, 24th August 2017