Swindon Council is consulting on a “Council Tax support scheme”. From April 2013 Council Tax Benefit (CTB) in its current form is being withdrawn. The government has previously provided 100% of the money that Councils pay out in CTB. However, it will in future be giving Councils a grant with a reduction of the amount they receive by 10%. For Swindon this means a reduction from £13 million to “approximately £11 million”. Local Authorities have to decide how to make up this shortfall. Swindon Council is proposing to to charge people who currently pay nothing and increase the payment of those who make a partial payment of their Council Tax. The government, fearing bad publicity and the potential electoral consequences, has instructed local authorities that they cannot cut CTB for pensioners. It has also said that “the impact on the most vulnerable people should be considered when Councils design their new schemes”. As a result of these exemptions the cut that everybody else receives will be much higher than 10%.
In the examples of the impact of the cut on different households, which Swindon Council has produced, we find that those people who currently receive 100% CTB will have to pay around 20% of it. Those who make part-payment face bigger increases. Ending some of the exemptions (see below) will mean even bigger rises for some. People who are working can be really stung. ‘Example 8’ is a 53 year old working part-time who will have a 322% increase in his payment, that is an extra £10.66 a week (owing to the proposal to lower the savings threshold to £6,000).
According to Swindon Council’s consultation document there are now 18,500 households receiving CTB. If you exclude pensioners and those households where the claimant, their partner or a dependent child, has a disability allowance (the Council is proposing to exclude them from having to pay Council Tax), it leaves 9,000 who will have their benefit cut. The examples shown by the Council involve cuts from £3.09 a week to £11.19. Some of these people will be Council tenants who are subject to the ‘bedroom tax’, which means they will have to make a payment of either £11 or £21 a week, on top of which they will have to find the money to pay their CTB contribution.
Take the example of somebody who has been made redundant and is living on Job Seekers Allowance of £71 a week. We know of cases where people will have to pay £21 a week from this pittance and now Council Tax as well. For people living on the breadline every penny counts. That people in such dire circumstances will be penalised on the very same day as the rich will have their tax cut (those on £150,000 or more a year will have the higher rate of tax cut from 50% to 45%), adds insult to injury.
Swindon Council in implementing the government’s cut is proposing to:
➢ Limit the maximum level of Council Tax support to 80% of the bill for each property;
➢ Withdraw the second adult rebate of 25% (e.g. for somebody on JSA);
➢ Treat child benefit (currently excluded) as a source of income in the Council Tax Support calculation;
➢ Cap the level of Council Tax Support to a Band D property;
➢ Reduce the amount of savings above which Council Tax has to be paid to £6,000;
➢ Increase the expected contribution from non-dependent household members by £5 a week.
Swindon Council’s ruling group has so far registered no objection to these cuts. This is despite the fact that some Tory Councils have condemned the proposals. Even in David Cameron’s own constituency, West Oxford District Council has condemned them as ill-thought out and pointed out that they will serve as a disincentive to work, hitting as they do the working poor. An internal report from the same Council also suggested that the cost and inconvenience of collecting small sums from people without the means to pay will make the whole system unworkable. Even the Chairman of the Local Government Association, Sir Merrick Cockell, has complained that “We feel a rushed implementation of a new scheme might lead to penalising claimants who already go out to work…”
The Lead Member for Finance in Swindon, mark Edwards, tells us that this cut in grant “is part of the government’s drive to encourage people into work by removing disincentives”. Cutting the amount of money that poor people have to survive on is a strange ‘incentive’. Impoverishing already poor people will not serve to drive them into jobs that don’t exist. With the mass unemployment we have it is difficult for many people to find work however hard they try.
Swindon Council’s consultation includes a questionnaire which assumes acceptance of these cuts. It fails to ask whether or not Council Tax payers support them. It gives us the opportunity to say who we think should be excluded from paying, though the more people who are excluded then the higher the increase will be for those who face a cut in their CTB.
Swindon Tenants Campaign Group views these changes as yet another unjust attack on the poor. We would ask you to tell the Council that it should press the government to reinstate 100% funding for CTB.
The Council’s ruling group will no doubt say it has to carry out the law. However, since the measures are not implemented until next April there is nothing stopping them from pressuring the government to executive another U-turn. After all, Tory MPs had no qualms in blocking the government’s reform of the House of Lords, and many of its MPs are currently demanding that the government reverse the big increases in rail fairs (owing to the pressure they are under from irate constituents). If the Council’s ruling group does not speak out against this cut then we can only assume they support it. We know that some of them personally feel uneasy about these cuts, but those suffering them will not be impressed by their (private) sympathy if they fail to speak out against them.
The Council’s consultation runs until November 9th.
You can email the Council your response to the consultation at email@example.com or write to:
Head of Revenues and Benefits, Swindon Borough Council, Civic Offices, Euclid St, Swindon SN1 2JH
Email Swindon’s MPs calling on them to demand the government reinstate the 10% cut, at:
You can read the consultation document and the questions on the draft scheme on-line at www.swindon.gov.uk/ctsconsultation