Review of Council Tax support

What is Council Tax?

Council Tax is a national tax set locally by every council based on the value of your property. Your home is placed in one of eight valuation bands based on its value at 1st April 1991.

The council is responsible for collecting Council Tax and this money funds about 20% of local public services, including things like refuse collection, adult social care, environmental health and education. Some of the money collected is passed to the Leicestershire police and fire authorities.

What is Council Tax Support?

From 1st April 2013, the Government abolished Council Tax Benefit and instead, all councils including Charnwood Borough Council developed a local Council Tax support scheme.

Because the Government reduced funding, nearly everyone who used to receive Council Tax Benefit (except pensioners) has to now pay something towards their Council Tax.

Charnwood Borough Council is now reviewing the Council Tax Scheme and is inviting residents, organisations and groups to comment on proposed changes for 2014.

How can I tell you my views?

We are asking you for your views on how we support people to pay their Council Tax in the future. Have your say by completing the online questionnaire.

This booklet will outline the ideas we are proposing.

How long have I got to give you my views?

We will consult with you until Friday, 20 September 2013 to get your views.

Is there anything this consultation isn’t covering?

Welfare reforms such as the changes to Housing Benefit and the introduction of Universal Credit are not part of this consultation.

• There will be no change to the amount of help pensioners currently receive.

• The impact on the most vulnerable will be considered when councils reviewing the scheme.

• The new scheme should encourage people to work and not discourage them from working.

What changes are being considered under the review?

1. Increasing the maximum limit on the amount of Council Tax Support that can be paid

In 2013 the Government provided a subsidy to councils who designed schemes that met certain criteria, for example: Councils that set a limit of 8.5% contribution towards Council Tax for those eligible for Council Tax Support.

For Charnwood Borough Council residents this meant everyone eligible for Council Tax Support would have to pay no more than 8.5% of their Council Tax Bill in 2013.

In 2014 the Government has said it will not provide a subsidy, this means that Charnwood Borough Council will consider increasing the minimum amount people will need to pay towards their council Tax bill.

Charnwood Borough Council is proposing an increase to the current Cap of 8.5% to either 10%, 15% or 20%.

3. Increasing contributions from other adult members of the household

Council Tax Benefit is assessed on the needs of the person making the claim, their partner and their dependent children. Other adults within the household are expected to contribute towards the Council Tax bill, depending on their income. This could change so that these adults contribute more towards the Council Tax bill.

4. Changing the amount of savings a person can have before benefits are given

In the current scheme, a person is not entitled to Council Tax Benefit when their savings are more than £16,000. Any savings their partner may have are also taken into account. This might change so that the savings limit is less than £16,000.

What impact will these rules have?

Under the present scheme the 8.5% cap means that based on a Band A property in Charnwood the average amount people in receipt of Council Tax Support are paying in 2013 is £1.60 per week.

If the Council increased the 8.5% cap to 10% this amount would increase to £1.71 per week

If the Council increased the 8.5% cap to 15% this amount would increase to £2.83 per week

If the Council increased the 8.5% cap to 20% this amount would increase to £3.77 per week