Agenda item

Report of the Head of Corporate Resources

The Cabinet considered the report of the Head of Corporate Resources that provided details of the review of the local Council Tax Reduction Scheme for 2019/20 and recommended that there be no change to the scheme for 2020/21 for working age claimants.

The report requested the Cabinet to recommend to the Council changes to discretionary Council Tax Empty Homes discounts following the outcome of a public consultation, and an additional increase to the Council Tax long-term Empty Homes Premium, following a consultation exercise that took place in 2018.

The report also requested the Cabinet to recommend to the Council an increase in the Exceptional Hardship Fund (EHF) budget from £150,000 to £170,000 from 2020/21 onwards.

The report provided an updated Council Tax Base for Sefton Council and each Parish area for 2020/21.

Decisions Made:     That

(1)    the contents of the review of the Council Tax Reduction Scheme for 2019/20 be noted;

(2)     the Council be recommended to make no changes to the existing Council Tax Reduction Scheme for 2020/21 for working age claimants;

(3)     the outcome of the recent consultation and equality impact assessment on the proposed changes to Council Tax Empty Homes discounts, as set out in Annex B, to the report be noted;

(4)     the Council be recommended to approve changes to discretionary Council Tax Empty Homes discounts from 1April 2020, to reduce the discount on uninhabitable properties from 50% to 0%, and to reduce the discount for the first month that a property is empty from 100% to 50%;

(5)     the Council be recommended to approve a change to the long-term Empty Homes Premium from 1April 2020, to increase the premium charged on properties that have been empty for 5 years or more from 100% to 200%;

(6)     the Council be recommended to approve the relevant 2020/21 Council Tax Base for Sefton Council and each Parish Area as set out in Annex A to the report; and

(7)     the Council be recommended to approve an increase in the Exceptional Hardship Fund budget from £150,000 to £170,000 from 2020/21 onwards.

Reasons for the Decision:

CouncilTax ReductionScheme

Each financial year the Council must consider whether to revise or replace its local Council Tax Reduction Scheme. The Council must approve and adopt the 2020/21 Council Tax Reduction scheme by 11 March 2020, as set out in the Council Tax Reduction Scheme (Amendment) (England) Regulations 2017.

This report comments on the impact of various changes made to the scheme in recent years together with the impact of the Government’s Welfare Reform changes. After consideration of the factors outlined later in the report, it is proposed that the local Council Tax Reduction Scheme for 2020/21 remains unchanged for working age claimants.

Council Tax Empty Homes Discounts

Reducing the level of support offered by the current discretionary local empty homes’ discounts may encourage owners of empty homes to bring them into use more quickly. It would remove the current favourable treatment of empty homes, encourage better use of local housing stock, bring the Council’s policy more into line with other local Councils in the Liverpool City Region that do not offer discretionary empty homes discounts and provide a much-needed increase in council tax income.

Long-term Empty Homes Premium

Increasing the long-term empty homes premium is intended to encourage owners to bring them back into use. Recent legislation allows the Council to increase the premium on properties that have been empty for longer than 5 years to 200% from 1st April 2020. Any additional income raised from the premium will help support the provisions of Council services.

Exceptional Hardship Fund (EHF)

The Council set the current budget of £150,000 in 2013/14. Since then the average Band D council tax charge in Sefton has increased by 25.6%. To keep pace with the increases in council tax the fund would have had to be increased by £38,500 in 2019/20. The fund has also been utilised to meet the cost of discretionary discounts awarded to care leavers since 2018/19. These discounts are costing approximately £19,000 in 2019/20. The suggested increase of £20,000 would offset the cost of the care leavers discounts in 2020/21 and restore some of the capacity of the EHF to alleviate the burden of council tax charges on CTRS claimants who are suffering exceptional hardship.

Council Tax Base

In accordance with Local Authorities (Calculation of Council Tax Base) (England) Regulations 2012, as amended, the Council is required to set a tax base for both Sefton Council and for each Parish Area for 2020/21 before 31 January 2020.

Alternative Options Considered and Rejected:

Council Tax Reduction Scheme

The Council last revised its local Council Tax Reduction Scheme in 2018/19 following a public consultation process. The changes introduced in April 2018 continue to address the Council’s priorities to minimise the impact on vulnerable residents, by striking a balance between dealing with Council priorities whilst supporting those experiencing financial hardship. As a result, the changes made in 2018 continue to be fully monitored and evaluated. No alternative options for change have been considered for 2020/21.

Council Tax Empty Homes Discounts

The Council could choose not to make changes to discretionary Council Tax Empty Homes discounts. This approach would not provide an additional incentive for owners of empty homes to bring them back into use more quickly. A lower level of Council Tax income would be generated, and a higher level of savings would need to be achieved in 2020/21.

Long-term Empty Homes Premium

The Council could choose not to increase the long-term empty homes premium; however, this would not provide any further incentive for owners of long-term empty homes to bring them back into use.

Exceptional Hardship Fund (EHF)

The Council could choose not to increase the EHF budget. However, this would restrict the Council’s capacity to alleviate the burden of council tax payments on those CTRS claimants experiencing exceptional hardship in 2020/21 and in future years.