TEESSIDERS WARNED OF COUNCIL TAX BENEFIT CUTS

First published by: Gazette live

NEARLY 37,000 Teessiders could have their Council Tax benefits slashed following the axing of a Government-run system.

Today, the manager of Middlesbrough Citizens’ Advice Bureau said he was “concerned” that the change to the system could lead Teessiders turning to “exploitative” high interest loan companies. Some 62,097 people in our area claim Council Tax benefit, according to figures released by the three local authorities.

Although pensioners are protected from the benefit reductions, 36,898 claimants could face cuts when the local Council Tax support scheme is implemented. The three local authorities spend £55.15m per year on Council Tax benefit. Under the new scheme, each Teesside council would have around £2m less.

But Teesside councils are facing a number of cost-saving measures as more than £100m needs to be slashed between them in the next four years due to Government cuts. Council Tax benefit is income-related and can be claimed by anyone who is liable to pay Council Tax in respect to their main residence. 

It is a national benefit with rules set by central Government and administered by local councils. But from next April the system will be scrapped and local councils will introduce their own local schemes. In scrapping the scheme the Government is also making 10% less cash available to councils for the benefit. As pensioners are protected, this means 20% less cash for the remaining claimants. Councils have until the end of January to notify the Government of their local schemes. If they refuse to implement a scheme then the Government will impose a scheme on a local authority.

John Daniels, manager of Middlesbrough Citizens’ Advice Bureau said the replacement of Council Tax benefit will happen at the same time as a number of other changes to the benefits system. He said: “The overall effect will be that many people already on low incomes will be even worse off.

“We are particularly concerned that people will resort to exploitative high interest loan companies, and as a result their financial position will become even worse.”

He urged people struggling with their money to seek advice as soon as possible.

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