More than 270000 poorest households in England face £80 council tax rise

More than 270000 poorest households in England face £80 council tax rise

Dozens more local authorities say they are reducing protection for vulnerable residents, research finds.

More than 270,000 of the poorest households in England face council tax hikes of £80 a year as the government’s safety net is withdrawn, a survey of local authorities has revealed.

Using freedom of information requests, research for the Joseph Rowntree Trust has found that from April another 48 local authorities are reducing protection for vulnerable residents.

Ministers cut funding for the means-tested benefit by £500m, around 10% of the total, last April and instructed local authorities to decide how the reduced benefit should be distributed.

However, to cushion the blow ministers offered £100m in subsidies to councils that designed schemes that would offer some protection to the poor. This scheme has not been renewed, with the result that this year will be the first that the government will no longer provide a dedicated stream of cash to take the poorest out of council tax.

The result of this – and further cuts to local authority budgets – is that more than a quarter of a million working-age households will see bills rise by an average of £78 a year, taking the amount of yearly council tax that they will have to pay to £176.

The additional reduction has left councils with an unpalatable choice between charging council tax to the working-age poor, who in many cases may not have paid council tax before, and finding additional savings to spending on local services on top of the cuts of 40% being made to council budgets by the government.

Some councils have simply decided they can no longer afford to protect the poor. In Chiltern council this means 2,500 of the poorest households, which had been spared the council tax, will now face an average bill of £261.

With council tax collection a legal requirement, many of the poorest have fallen into arrears. Data obtained by the Guardian last year showed that government cuts to council tax benefits had left 670,000 facing bailiffs in the first six months of 2013.

Peter Kenway of the New Policy Institute, which conducted the research, said: “‘The data published today suggests that around a quarter of local authorities are amending their council tax support schemes for 2014-15. In almost all cases these changes will adversely affect working-age council tax support recipients. Those recipients affected will see their support further reduced by £78 on average per annum, more than doubling the average amount of council tax payable.

“Most of those amending their schemes were in receipt of the transitional grant funding. As this grant was available for one year only, many local authorities have decided to pass on more of the cut to vulnerable residents in order to make up the funding shortfall.”

The Local Government Association warned of worse to come. It pointed out that if council tax support funding is reduced in line with cuts to overall funding, then the total cut to council tax support funding between 2013-14 and 2015-16 would amount to 28%, or £1bn.

Hilary Benn, Labour’s local government spokesman, said: “Local government has faced the deepest cuts to any part of the public sector. We know as well that the poorest councils are facing the biggest reductions in their spending power.

“This new poll tax – the responsibility for which lies squarely at David Cameron and Eric Pickles’s doorstep – hits the poorest hardest, forcing up council tax bills for those least able to pay them.”

The government said that under Labour council tax bills had doubled. Brandon Lewis, the minister in charge of the policy, said: “Welfare reform is vital to tackle Labour’s budget deficit. Under the last administration, more taxpayers’ money was being spent on benefits than on defence, education and health combined.

“Our reforms to localise council tax support now give councils stronger incentives to support local firms, cut fraud, promote local enterprise and get people into work. We are ending Labour’s something-for-nothing culture and making work pay.” © 2014 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

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