Households in Coventry who receive support to pay the cost of their Council Tax could be asked to pay 15 per cent of the total amount from April 2016.
A report to the Council is recommending that around 20,331 people, who currently receive benefits to pay for all or part of their Council Tax, will be asked to make a contribution. The proposal is part of a wide range of savings that the Council is drawing up to tackle increasing budget pressures.
The Council Tax Support Scheme that is run by the Council will continue to provide 85 per cent of the payments to the residents affected, but it will mean many people being asked to pay Council Tax for the first time.
Cllr Damian Gannon Cabinet Member for Strategic Finance and Resources, will consider a report from finance officers setting out the savings targets. It will still mean that the Council continues to fund £23m per year on its Council Tax Support Scheme – which is more than the average offered by other councils.
Cllr Gannon said:
“It is a difficult decision but I don't think there will be any other option if we are to protect vital front line services.
“We have been talking to our partners in the local advice services including Citizens’ Advice Bureau about the consequences of introducing a 15 per cent contribution and I think that they understand the dilemma that we face.”
“We want to make sure that we have good communications with the residents affected because it is important that low-income homes can access advice.”
The Council Tax Support Scheme is a means tested discount to help low income households with the cost of council tax payments. Means-tested is a way of saying that the amount of benefit you get depends on your income.
In April 2013 central government replaced the national council tax benefit scheme with a new scheme administered by the local authorities. For the past three years the Council has continued to fund Council Tax Benefit Support absorbing a cost of £5m. The scheme is for working age people only (‘state age’ pensioners excluded).
Of 326 councils in 2015/16 just Coventry was one of only 42 local authorities providing 100% Council Tax Benefit support.
Approximately 16,000 of the 20,331 working age recipients of Council tax support don’t pay any council tax at the moment (as they receive maximum benefit). Currently 112,000 households pay Council Tax.