COULD THE AUTHORITIES FACE PUBLIC DISORDER OVER COUNCIL TAX BENEFIT CHANGES?

First Published By: The Westminster

The issue of cuts to Council Tax benefit may sound esoteric; what’s one more cut in a world of public sector austerity?

Yet most cuts to benefits are relatively simple to administer: you still give people money, just less of it.

Council Tax is rather different, as it involves taking money from people. Cutting Council Tax benefit means that you need to collect even more money from them. 

There is already a high level of non-payment of this levy and some local authorities are worried that the problem will only get worse when the cut comes into force.

In a nutshell, the government is not only cutting the benefit by 10 per cent but also shifting responsibility to councils. But ministers have made it much harder for local authorities to carry out the cut as they have ordered them to exempt pensioners and “vulnerable groups”, thought to include the disabled and families with children.

That means that out of 5m people who receive the benefit, only an estimated 1.3m may have to take the impact of the cut – implying they could be hit with a reduction of almost a third. That would mean an average of £330 per person, equivalent to the average household’s electricity bill over a nine-month period.

The public response from local government is still muted but some councils have already cottoned on to the possible implications. It’s not an exaggeration to say that there could be a repeat of the uproar which followed the poll tax two decades ago.

Some councils have been lobbying the government to be allowed to cut other exemptions, for example the 50 per cent discount which single people get on their Council Tax. But ministers have held firm; the single discount is enjoyed by millions of elderly people.

And so the brunt looks most likely to fall on low-income workers and the unemployed when the changes take effect in 2013. As a document from Tory-controlled Taunton Deane council says: “In the end we will have to decide, from a limited number of claims, which vulnerable group we support the least.”

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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SWANSEA, CAERPHILLY AND MONMOUTHSHIRE COUNCIL TAX FREEZES PROPOSED

First Published by: BBC

Swansea, Caerphilly and Monmouthshire councils are the only authorities in Wales so far who have frozen Council Tax this year, with average increases set for a record low of 2.1%.

Anglesey council plans the biggest rise at 5% - the capped rate - while 15 councils plan to raise rates and three are still to decide. The figures have yet to be ratified and do not include police precept. The Welsh Local Government Association (WLGA) welcomed the low rises.

Council Tax has been frozen in England. It will be the second year in a row Caerphilly has frozen their rates but the first for Swansea and Monmouthshire. Stuart Rice, cabinet member for finance at Swansea council, said the freeze was possible because of savings within the council that do not affect front line services.

"We recognise that people are going through tough times at the moment and we do not want to add to the financial burden on them," he said. "Household bills are continuing to go up, when at the same time many people have seen their incomes frozen or even cut."

Caerphilly council's cabinet member for financial resources Colin Mann praised his authority for being able to freeze rates again. He said: "We have had tremendous support from employees across the authority making every effort to reduce the cost of delivering services and maintain quality front line services and we have achieved savings of £17m in three years.

"My colleagues in the cabinet have worked hard to make the savings in their own service areas and divert money to where it is most needed and effective." Monmouthshire council said the meeting to formally set its Council Tax charge level would not be held until March but a freeze had been agreed.

The council's leaders say despite this they will be able to offer in priority areas "more spending on schools and more spending on the vulnerable", benefiting from savings in the way the authority works. The council said it has been "relentless in our drive to modernise our delivery of services and driving down costs at every opportunity," which has included looking at leases for buildings, equipment and vehicles, as well as staff rationalisation.

This year, Anglesey council wants to raise its Council Tax by 5%, citing a "reduced settlement from the Welsh Assembly Government", while Conwy is looking at a 4% increase. Andrew Kirkham of Conwy council said the increase would see a band D home owner paying £884.62, but said it was still one of the lowest amounts in Wales and England.

"We're already looking at more savings, but I know in my heart of hearts that we can't deliver a zero per cent increase," he said. Ceredigion, Blaenau Gwent, Denbighshire, Flintshire, Gwynedd, Merthyr Tydfil, Powys, Rhondda Cynon Taf, Torfaen and Wrexham councils want to raise their taxes by between 2.2% and 3.5%.

Carmarthenshire council is planning a 1.97% increase, Pembrokeshire council has set its proposed rate at 1.7%, while Cardiff council plans to impose a 1.44% increase. Bridgend, Neath Port Talbot, and Vale of Glamorgan councils are yet to indicate their plans.

Rodney Berman, WLGA finance spokesman, said that despite building pressures on budgets, councils across Wales had managed to keep increases to the bare minimum required to protect vital services. "Our focus is on getting the balance right for our citizens," he said. "Most families have cut back on their spending but many are still struggling.

"Councils want to minimise the financial impact of Council Tax increases on these families while ensuring that the vital local services they rely on continue to be provided." WLGA leader John Davies said he was pleased to see the predicted average increase across Wales had been kept as low as possible.

He said it reflected "the determined effort by councils to strike a balance between providing these vital services but also limiting the pressure on hard-pressed households." A Welsh government spokesman said: "We welcome that local authorities are predicting a record low increase in Council Tax for 2012-13.

"The setting of Council Tax is a matter for each authority reflecting their own needs and priorities. Local authorities are accountable to their electorate for decisions on budgets and associated Council Tax levels. "Council Tax levels are on average 19% lower than in England, reflecting the better funding settlement provided by the Welsh government compared with England."

Last October, local government minister Carl Sargeant said he was distributing the revenue support grant which allowed councils to freeze Council Tax if they wanted providing they protected front line services. "It will be for each local authority to justify their decision on Council Tax to their citizens," he said.

"I expect local authorities to be forensic in their consideration of the balance between the need to sustain key services for their citizens' benefit and the need to limit any additional pressure on hard-pressed households. "As in previous years, I stand ready to use the capping powers vested in Welsh ministers to limit any increases that I consider unreasonable."

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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PASSING THE FIRST GREEN COUNCIL BUDGET

First Published By: Voting and Green Issues

The next financial year in Brighton & Hove will see a first...

The first ever Green council budget will be the basis of how our council runs. Last night was the budget council meeting where we Greens proposed and passed our budget. In the face of the government’s harsh, ill-conceived austerity programme it was a budget of political hope. 

To show that change is possible, that Labour and Tories don’t have an unbreakable grip on political power. Our budget showed up the opposition’s favourite lie, that Greens aren’t up to the job of governing.

In the face of above average government cuts our budget protected so much that the vulnerable and needy in our city depend on. We protected grants for the third sector, the adult social care eligibility criteria, the parks service, support for carers, staff terms and conditions, the living wage for our lowest paid staff, the preventing homelessness budget, youth services and branch libraries. We’ve expanded joint working with the third sector and public sector both in and out of the city. Overall the budgets for children’s and adult social care budgets will see no decline over two years.

We produced this budget in a new way – more open, more inclusive with more detail than ever before. We produced a two year budget for the first time, publishing earlier than ever before. We involved the opposition parties, unions and community & voluntary sector more often and in more detail than ever before.

For the first time there is a carbon budget, we have expanded the equality impact assessment process and extended the Value for Money programme to find greater efficiencies.

The capital programme also had a huge amount of positives, the Local Transport Plan funding almost doubled and completely protected for use on improving city infrastructure for the first time in living memory. Funding for new school places, a new library, solar panels, investment in social care buildings and much more.

Yes, due to government cuts, some services will be reduced, fees will go up, efficiencies will be found – but so much has been protected. We acknowledged the concerns of allotment holders over free increases there, which is why we responded by spreading the increases over two years. Over the next year I’m committed to working with the allotment community to expand concessionary rates, open new allotments and address the issues they’ve raised.

We had new initiatives too like £300k to fund 3rd sector youth services, £120k from auctioning the mayor’s number plate to fund 3rd sector capital investment, pilots for food waste and commercial waste collections.

We also proposed to reject the Tory tax freeze. Our 3.5% Council Tax increase, one of the lowest increases in this council’s history, would protect our funding base and help us to offset the worst of the cuts. A tax position supported by GMB, Unison and NUT unions and followed by 30 councils around the country. They all could see that the one-off tax freeze the Tory government wanted us to take this year was a con trick, which would leave us worse off in the long run.

And so it proved to be, we will be worse off in the long run now. Sadly, and I truly mean that, the Labour group — despite our repeated attempts to negotiate with them — produced an amendment which was almost identical to the Tory amendment to introduce a tax freeze. They have started to think just like Tories. So whilst shocking Tory amendments to close a nursery, axe union officers and slash support for those experiencing benefit cuts were defeated, Tories and Labour voted together to adopt the tax freeze.

You expect Tories to cut government, that’s what they do. But for Labour, when we’re experiencing above average cuts as a city (indeed the highest for our region), to push more cuts on this council is utterly shocking.

Their amendment slashed funding for our sustainability team, cut funding for training staff, reduced council communications with residents, cut funding for bringing private empty homes back into use whilst adding an additional £3.6m cut to next year’s budget – without any attempt to explain how they would pay for that.

Despite having made so much noise on City in Bloom, public toilets, sports fees, children’s centres and more none of these were in their amendment. In fact they never even submitted a petition on those issues – they were just leaflet fodder for them. This city has seen New Labour become Blue Labour as they’ve shifted hard right, falling into the Tory trap of the tax freeze, which leaves our council worse off for years to come.

Labour also have made false claims that they’ve saved the mobile library. They haven’t. Their amendment to fund a new vehicle is £40,000 short on the running costs. Unless they can identify that money there’s no new mobile library – another financial gimmick is all they could offer.

Clearly I am disappointed that the tax freeze was imposed on our budget. But that’s democracy, the other two parties voted for a Tory policy and voters will know who added to the burden of cuts and austerity in our city. We voted against the amendments. There were many, many speeches last night, some of them good.

My wife and ward colleague made her mark with a witty maiden speech rebutting some nasty xenophobia from the Tory benches. Not everyone likes the theatrics of council meetings, but I think it’s important every councillor is given the chance to explain their views and position if they so wish. I personally do enjoy hearing the views expressed, even if they do sometimes exasperate.

With only one amendment passing, we were left with an over 99% Green budget. None of us want there to be cuts, Greens adamantly oppose cuts and austerity, but sadly our system of government gives the council little choice on the reductions passed down to us. The Green budget was a fair budget for tough times, protecting vital services. Clearly the other parties agreed, joining us in voting through our financial plans for the next year.

My door remains open to opposition councillors wanting to begin the co-operative working they’ve so far felt unable to embark on. But first and foremost I’m focussed on delivering our Green manifesto and budget to build a better, fairer city for our future.

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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COUNCIL TAX - SAVING TIPS WE ALL NEED TO KNOW:

First Published by: The Guardian

Saving tips we all need to know

Challenge your bill:

Don't be afraid to query your Council Tax bill. In 1991 properties were given "drive-by" valuations to assess which band they should be in: many ended up in the wrong band as a result, with home-owners paying hundreds of pounds more than necessary. 


But the internet means it's now possible to have a professional check done and challenge your band - this is worth doing as any repayment will be backdated.

To check what band your home is in, go to Rebates UK Claimsand Services Limited 

They will have to compare your house with similar houses in the neighbourhood. If there looks to be a discrepancy (ie. you're in a higher band than neighbours in a similar property) you may have a case, which they will pursue for you.

Those in areas of mixed housing are most likely to have been assessed wrongly. Those on estates where all properties were built at the same time are less likely to find a discrepancy.

If your property is found to have been placed in the wrong band, you could be due a rebate for all the extra tax you have paid over the years - from the date you moved into the property or even back to 1993, when the system began.

Get a student in:

Households comprised entirely of students don't have to pay Council Tax at all, and if you have one student in your household you get 25% off.

Pay on time:

Council Tax is billed annually by your local authority. Most give you the choice of paying the whole bill upfront, in two half-yearly instalments or monthly either in person, at the bank, over the phone, online or by direct debit. But if you miss two monthly payments, you could lose your right to pay in instalments and will be sent a demand for the whole lot.

Find out if you are entitled to any exemptions:

Some properties are exempt from Council Tax, or qualify for a discount on their bill. For example, empty unfurnished properties can be exempt for up to six months, while properties that are uninhabitable or being renovated are exempt for up to a year.

Furnished second- or holiday- homes in England and Scotland will be liable for Council Tax, but will have a discount of between 10% and 50% because no one lives there on a permanent basis. Other properties that could be exempt from paying some or all of the Council Tax include homes that are unoccupied because the normal resident has had to go into care. A full list of exempt properties can be found at tinyurl.com/3wynds

Claim Council Tax benefit if you can:

If you earn less than £16,000 you may be eligible for Council Tax benefit: some people on low incomes can get a reduction of up to 100%. You can check if this applies to you by contacting your local council, but as a rule of thumb, if you're entitled to Income Support, income-based Jobseeker's Allowance or the guarantee credit of Pension Credit, you're likely to be eligible for help with your Council Tax.

Or a second adult rebate:

Council Tax is based on the assumption that two adults live in each property, so you might be eligible for a second adult rebate if your partner or person you live with is on a low income, is on Income Support or is claiming JobSeeker's Allowance. Other people who may be able to get money off their bill include disabled people, carers and the mentally ill.

How your bill is worked out:

Council Tax is billed per property and how much you pay depends on the band your property is in. Properties were last assessed for bands in 1991, with those worth under £40,000 at that time placed in band A and those worth over £320,000 in band H. The 1991 valuation is still used to determine a property's band.

Properties in band A have the smallest Council Tax bills (normally around £1,000 a year), while those in band H pay the most (anything up to about £3,000 a year). Your bill depends not only on which band your property falls into, but also on your council - each sets its own rates according to political as well as financial concerns.

Occupiers not owners are billed, so tenants rather than landlords pay in a rented property. Single occupiers get a 25% discount.

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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SAVING MONEY ON COUNCIL TAX

First Published by: Mortgage Guide UK.

When the Government introduced the Council tax in 1991, they rushed to get houses valued.

 

They outsourced the job to estate agents and other people. Usually, they would make valuations just be having a quick look at the outside of the house and making a best guess about what value it was in.

Since 1991, there has been no re-banding. The effect is that many houses are incorrectly banded leading to a significant number of people paying too much Council Tax.

The easiest way to check is ask local neighbours what band they are in. If they are in a lower band you have a very good chance of not just getting a lower Council Tax bill, but getting a backdated rebate. A friend of mine recently was successful in getting a lower council tax band.

Other tips for Saving Money on Council Tax:

• Students Don’t Pay council Tax
• If you live alone, you are entitled to get a 25% discount. Make sure you tell the council though.
• If there is one adult and several students, you are entitled to the 25% discount.
• Renovation. If the house is empty for renovation, you can claim an exemption for up to 12 months.

On a personal note, I really dislike the Council Tax; it is very regressive and takes a high % of my meagre teaching income. I would like to see a local income tax which would be fairer. The thing with the Council Tax is that it was rushed through because everyone despised the poll tax. But, the solution given was not the best.

Other Extreme Council Tax Savings:

Live in an area where council tax rates are low.

Live where council services are run on the basis of good value for tax payers money or where the government subsidy is high. ‘If you’re on a low income, whether you’re working or not, and need financial help to pay your Council Tax bill, you may be able to get Council Tax Benefit. 

Beware of the potential ‘mansion tax’ beloved of the Libdems but also keep an evil eye on Eric Pickles rhetoric or reality on Council Tax 

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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COUNCIL TAX FROZEN FOR THIRD YEAR IN A ROW

First Published by: Portsmouth Express

COUNCILLORS in Lib Dem-run Portsmouth have decided to freeze Council Tax for the third year running.

They have also decided on a budget designed to protect services for vulnerable people, and invest more than £30M in projects that will pave the way for more homes and jobs.

The Portsmouth City Council budget also shows that efficiency measures within the organisation are on track, and expected to save millions of pounds.

The council’s share of the Council Tax bill will stay at £1,149.12 tax for band D house. The total for a band D property, used as the national benchmark, will be £1,361.50, including Police and Fire Authority.

But most Portsmouth residents are in band B, and will pay £1,058.94 or less.

Cllr Gerald Vernon-Jackson (pictured left with local residents), Leader of the council, said: “Government is cutting our funding by over 28% between 2011/12 and 2014/15, and we have to reduce spending by £54m in that period.

“However, to protect residents’ pockets we’ve frozen Council Tax again. “And rather than make severe cuts to services that residents need, almost all of the £8m we need to save in the 2012/13 financial year will come from changing the internal processes of the council to make them more efficient.

“We believe we can save £30m this way, over the next three years.“We are employing fewer people and reducing the number of senior managers. “We’re also looking to the future by investing more than £30m in the road system. We plan to build a new motorway junction at Tipner, opening that area up to development, including badly-needed new homes.

“We also plan to change the layout of the main route through the city centre, making journeys easier and making the proposed Northern Quarter shopping development an even more attractive proposition.

“We’re also modernising residential care, to the tune of more than £6.6m. “Another £3.7m will be used to improve school buildings that badly need work. “A big priority for us was to cope with a rising demand for children’s care and social care for adults.

The work we do in caring for looked-after children and people with disabilities is often invisible to most Council Tax payers. We’re proud to provide it, but it’s very expensive, with some people needing care costing around £1/4million a year.

“I’m glad to say that the overall financial health of the council remains strong.”

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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TAX FREEZE OFFER 'LESS GENEROUS' THAN LAST YEAR'S

First Published by: Local Government Chronicle

George Osborne’s fresh Council Tax freeze:

Is being offered on far less generous terms than last year’s and could result in future shortfalls of millions of pounds, LGC understands.

The chancellor announced plans to extend the Council Tax freeze for another year, costing the Treasury some £800m in his speech to the Conservative party conference. However, in a crucial difference to last year’s offer, the Treasury will not compensate councils for the loss of future revenues that comes from keeping their rates static in 2012-13.

The offer (see box below) appeared to be on similar terms to last year with councils eligible for a grant equivalent to a 2.5% increase in their Council Tax if they freeze their rates.

The 2010 spending review clearly stated that “local authorities who freeze their Council Tax next year will have the resultant loss to their tax base funded at a rate of 2.5% in each year of the spending review period”. The review allocated £0.7bn to compensate councils for the permanent loss to the Council Tax base up until 2014-15.

But the 2012-13 offer appears only to compensate councils for the loss in revenue in that financial year – meaning councils will face a funding shortfall in 2013-14.  

A senior local government source said: “The offer is a one-year deal funding costs for 2012-13. Councils will have to think about the impact that this could have in future years when considering whether or not to take the grant.”    

A Treasury spokeswoman declined to comment on whether councils would be compensated for losses in future years as a result of agreeing to the latest deal.

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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FULL TAKE-UP OF COUNCIL TAX FREEZE UNLIKELY

First Published By: Local Government Chronicle

The government’s hopes of securing a nationwide freeze in Council Tax levels next year are unlikely to be realised. 

Exclusive LGC research suggests, with a significant minority of councils unconvinced by ministers’ offer to the sector.

According to the first survey of council finance directors on the issue, the less generous terms on which funding is being offered, equivalent to a 2.5% rise, has left one local authority in five considering turning the proposal down.

A small minority of councils (4%) are likely to reject the deal outright and increase Council Tax while another 16% are undecided, according to responses from 146 council finance directors. Meanwhile, almost half of councils planning to take up the grant believe doing so will force them to implement larger increases or cut services the following year.

Asked to make a projection of their council’s plan for tax levels in 2012-13, 79% of the respondents said they would accept the freeze, but many said that would lead to higher levels of Council Tax increase in 2013-14.

The survey, which was conducted on condition of anonymity, showed no clear split along party lines, with two Conservative-controlled councils among the six saying they intended to turn down the offer of the government grant.

Two-thirds of those councils undecided about the offer were also Conservative-controlled authorities.

Brighton & Hove City Council, which was recently won by the Green Party, is one council which has been open about its plans to increase Council Tax next year. Jason Kitcat (Green), cabinet member for finance, said LGC’s survey results were “just the tip of the iceberg” and predicted more councils would reject the government’s offer.

“The rising numbers of councils across the country coming out and rejecting this government gimmick is just the tip of the iceberg as it is clear alarm is spreading in town halls across the country. Unlike previous years this grant is only available for one year and so any decision to freeze Council Tax this year would mean town halls would have to find more money next year which is of course delaying the problem.

“The latest figures show that it would cost us £5m over two years and leave Council Tax further behind inflation so that future increases would be even higher which is not in the best interests of our residents and this city.”

As exclusively reported by LGC last month, councils face a difficult choice because the £805m grant to fund a 2012-13 Council Tax freeze is being offered for one year only, unlike the package for the 2011-12 freeze. This package included £700m of funding each year between 2011-12 and 2014-15 to fund the permanent damage to the CouncilTax base resulting from the freeze.

LGA Liberal Democrat group leader Gerald Vernon-Jackson told LGC at the time it was “not an offer that many councils can seriously consider taking up”. He predicted that local authorities would increase 2013-14 Council Tax by more than originally planned in response to the funding ‘cliff edge’ produced by the one-off deal, and LGC’s survey suggests this is indeed a serious concern.

The finance director of a Conservative-controlled district that intends to accept the grant said: “Financially it makes no sense, but politically members feel they’ve no choice. It means that increases in 2013-14 will be higher in order to recoup the loss of income.”

The chief financial officer of a Labour-controlled district that is set to take the grant said: “This reduces CouncilTax baseline and local authorities are already having to manage significant reductions in grant funding.”

Counties face a particularly tricky decision with all-out elections scheduled to take place in May 2013, just as Council Tax bills for 2013-14 land on voters’ doormats. Despite this, it was counties that expressed the greatest interest in taking up the freeze, with 92% reporting they intended to take the grant.

Paul Kent, president of the Society of County Treasurers and Dorset CC’s chief financial officer, said: “It’s going to be very hard for councils to explain why they didn’t take the grant, because they’d rather charge residents a 2.5% increase now.”

Of the 95 authorities that offered further details of the impact of the freeze on Council Tax levels in 2013-14, 29% said it would result in a larger increase than planned and 18% said they would need extra savings or service cuts.

Ten councils claimed they would have to budget for a Council Tax increase of 5% that year.

Mr Kent said the knock-on effect “makes members think more carefully about what they want to do, but a freeze still gives the taxpayer a year’s grace”.

Responses to the government’s offer also depended on where the council was. Authorities in London and the south-east were the most likely to accept the government’s offer. The north-east was the region least likely to accept the grant (67%). The north-west (71%) and the east Midlands (73%) were the next least positive.

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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