Agenda item

Council Tax Reduction Scheme

Report by Revenues and Benefits Manager (attached).


The Committee considered a report by the Revenues and Benefits Manager, (circulated previously) regarding the Council Tax Reduction Scheme.


The Head of Customer Focus highlighted the following:


·         In April 2013, as part of the national welfare reform, the Government
changed the way financial support for Council Tax was managed. This meant that the national Council Tax Benefit system, which helped people with low incomes meet their Council Tax obligations, was replaced by new Council Tax Reduction schemes designed, administered and managed by Local Authorities.

·         This change did not affect pension age claimants whose scheme was prescribed by central Government.

·         Each year the scheme was reviewed. The Devon Revenues and
Benefits Officers Group work together in reviewing schemes across the

·         Since 2013, the majority of authorities have required all working age
applicants to pay a minimum payment. In North Devon our working age
applicants pay at least 20 per cent of their charge.

·         Working age applicants in the Teignbridge District Council area still
receive 100 per cent support towards their Council Tax.  As with many Council’s nationwide, other Devon Councils are now considering increasing support to 100 per cent for those households on the lowest of incomes. The proposal for 2023-2024 is that we at North Devon increase ours.

·         In addition its proposed to disregard emergency increases in
national welfare benefits and certain crisis payments paid to taxpayers.

·         Many households had struggled to pay the minimum 20 percent contribution. This had led to additional costs being added to the balance on Council Tax bills, court and enforcement action and, in many cases, the amounts demanded were eventually written off as they were deemed uncollectable.

·         There were 520 households who had an attachment to their benefits with a further 836 households awaiting an attachment to their benefit to collect unpaid council tax.

·         The Council undertook a comprehensive consultation on the proposals
during the period 7 September 2022 – 19 October 2022. This consultation was promoted in the following ways;

Ø  Press release in local newspaper;

Ø  North Devon Council website; and

Ø  On Social media accounts such as Facebook and Twitter.

·         A total of 96 responses to the consultation were received. The results were shown in full, in Appendix B. The majority of responses received were in favour of the proposed changes.

·         Precepting Authorities and the local Citizens Advice were also consulted and their responses, where received, are shown in Appendix C (Fire service) and Appendix D (Devon County Council).

·         An increase in the cost of the scheme, although this was offset in part by reduced cost of resource in the collection of unpaid Council Tax.

·         The Council Tax collection rate currently budgeted for in North Devon was 97 percent. It was higher but the adoption of the Council Tax Reduction scheme in 2013; saw collection rates overall start to fall. This was because collecting the 20 percent Council Tax from the poorest families was a challenge. These debts were proving to be very difficult to collect.  The impact from this within the current collection fund was an ever-growing debt in this area, together with increased bad debt provision – so this was a growing cost within the collection fund.  These proposals would enable the Council to free up resources to concentrate on increasing the tax base and recovering collectable debt.


The Director of Resources and Deputy Chief Executive added that the overall collection rate would likely continue to decrease if a change was not made.  The response from Devon County Council, shown in Appendix D of the report, in relation to the proposed changes, reassurances had been given to Devon County Council that the collection rates would likely increase as a result of the amendments to the scheme.




(a)  The Council Tax Reduction scheme, as detailed at Appendix A of the report, to help households on the lowest incomes be adopted; and


(b)  The amendment to include disregards for any emergency increases in national welfare benefits and certain crisis payments made to taxpayers (Local Welfare Provision).

Supporting documents: