Council tax could be reduced by 100% for poorest households in parts of Suffolk
Councillors in Babergh and Mid Suffolk are now asking the public about the idea - which is designed to help with the cost of living
Last updated 4th Oct 2022
A plan to cut council tax completely for the poorest households in Babergh and Mid Suffolk will be put to the public later this month.
Babergh and Mid Suffolk District Council cabinets yesterday voted to start a period of consultation on a temporary maximum council tax reduction scheme for working age people of one hundred per cent.
Consultation is expected to run between October 13 and November 24 this year, and people liable for council tax will be able to comment – as well as bodies supporting people with debt problems and landlords.
A decision is expected by February 20, 2023, at the latest – ready for the new scheme to be implemented in April 2023.
Conservative councillor John Whitehead, cabinet member for finance at Mid Suffolk District Council, said: “I must confess I support the principle of the view that all but the very poorest pensioner should make some contribution towards our vital public services, albeit very modest.
“However, the operation of this current council tax scheme leads to administrative costs that outweigh the money gained from people paying five per cent council tax.
“It is complicated by the need to have monthly reviews as the incomes of people receiving universal credit fluctuate.
“Changed circumstances prompt a reassessment, and a new council tax bill and payment programme. A new instalment plan defers payment and, just before the first is due, universal credit may again be recalculated – meaning the process starts again.
“This causes confusion, and involves officer time, printing costs and postage costs.
“The small amount of payment is also difficult to get from those unable or unwilling to pay. The recovery process itself can lead to costs higher than the amount gained.
“This change is logical. Given the additional financial pressure everyone is experiencing with inflation, it is also timely.”
The scheme approved for consultation was the one recommended by officers, out of four possible options. It includes a maximum possible reduction of one hundred per cent for people who get legacy benefits or universal credit, with measures to prevent people on universal credit from falling through the cracks.
Legacy benefits are the separate benefits, including jobseeker’s allowance and housing benefit, incorporated into one through the universal credit system that started in 2013.
Rather than reviewing eligibility for the full council tax cut every month as earnings fluctuate, the route chosen proposes an automated system based on department for work and pensions (DWP) data.
As the automated system could lead people just-about-eligible for the reduction to fall through the cracks, the option chosen also adds a ‘transitional protection scheme’. According to the report, transitional protection would be given to approximately 314 people, and would leave no one eligible for the reduction financially worse off.
Conservative councillor David Busby, cabinet member for assets and investments at Babergh District Council, said: “I think anything where you can get a benefit that is paid for by efficiency is good news.
“Increasing the maximum from 95 per cent to 100 per cent is good for people in need, and simplifying the universal credit scheme should do this. It will also make it cheaper for us to administer.”