Agenda item

REPORT OF THE HEAD OF REVENUES, BENEFITS AND INFORMATION TECHNOLOGY

RESOLVED:

(1)       That the Scheme attached at Appendix 1 to the report, be approved as the Council Tax Reduction Scheme (CTRS) for North Hertfordshire for 2018/2019;

(2)       That in accordance with Section 59A.1 of the Council Tax Reduction Scheme referred to in (1) above, the percentage by which each award to each recipient in the Non-Protected Groups be reduced at 25% for 2018/2019 (the same as for 2017/2018); and

(3)       That the amount to be distributed to the Local Precepting Authorities for Council Tax Reduction Scheme Grant is £38,885 and that this is distributed in proportion to the total awards of CTRS in each Local Precepting area.

REASON FOR DECISION: To comply with the requirement to approve the local Council Tax Reduction Scheme fro the coming financial year.

The Executive Member for Finance and IT presented the report of the Head of Revenues, Benefits and IT in respect of the proposed Council Tax Reduction Scheme (CTRS) 2018/19.  The following appendices were submitted with the report:

Appendix 1 – Council Tax Reduction Scheme 2018/19; and

Appendix 2 – Glossary of Terms.

The Executive Member for Finance and IT referred to a small update to Paragraph 5.8 of the report, which was to confirm that the Council had not received any comment on the proposed Scheme from either Hertfordshire County Council or the Hertfordshire Police and Crime Commissioner.

The Executive Member for Finance and IT advised that the Council had a legal obligation to operate a CTRS and had done so since 2013/14.  To simplify the issue, in practical terms the Council had chosen to reflect the terms of the old Council Tax benefit scheme and then to amend these in the fashion set out in Paragraph 7.4 of the report.  Essentially, pensioners’ (and their dependents) benefits were protected on the same basis as the old scheme.  Further, to comply with the Government directive that any new scheme should incentivise work the earnings disregard within the scheme were increased by 50%.

The Executive Member for Finance and IT stated that, given that the Government support for all such schemes was reduced at inception by 10%, Councils had to decide how this reduction in support should be applied to those in receipt of non-protected benefits.  NHDC had opted initially to reduce all benefits paid to non-protected recipients by 33.33%, but this had been reduced to 25% from 2015/16.

The Executive Member for Finance and IT explained that because of the wayin which the scheme operated, it was subject to two major variables, namely the actual Council Tax income that was foregone by the Council and the number of claimants under the scheme.  The level of Council Tax charged to residents had been increasing throughout the duration of the scheme, whilst the number of claimants had been reducing.  The interaction of these two factors was set out in Paragraph 8.38 of the report.  It should be noted that whilst there had been an overall reduction in the number of claims of nearly 20% the total value of claims had only fallen by some 8.3%.

The Executive Member for Finance and IT advised that the Cabinet had reviewed the operation of the scheme on two occasions in the last six months and were recommending two small technical changes to the detail of the operation of the scheme, the details of which were set out in Paragraphs 8.3 and 8.4 of the report, which basically reflected similar changes which were being applied to the test for Housing Benefit.

The Executive Member for Finance and IT stated that the other factor which had been considered was whether or not the current 25% reduction factor should be amended.  One of the major variables in the scheme was the level of Council Tax that the Council would need to forego through its operations, and whilst final decisions were still to be made, it was unfortunate that that it was expected that precepts would increase across all the major precepting bodies.  With this in mind, and even allowing for the extremely high collection rates achieved by the Council, it was not believed that it was appropriate to make any changes this year and hence it was recommended that the discount level remained at 25%.

The Executive Member for Finance and IT drew attention to the proposal set out at Paragraph 8.26 of the report.  This related to the “funding” of the payments that the Council received from Central Government and which the Council passed on to Parish, Town and Community Councils.  This was originally set at £91,000.  It had, however, reduced over the years in line with the percentage reduction in general financial settlement that the Council received from the Department of Communities and Local Government.  Paragraph 8.26 referred to a sum of around £39,000 which it was proposed to pass onto these organisations in 2018/19.  However, he reminded Members that the Council now found itself in the situation where it was in a negative Rate Support Grant (RSG) position, whereby it was required to pay Council Tax Payers money to Central Government.  Whilst it was the case that RSG was only a proportion of the funds that the Council received from Central Government it was a substantial proportion, and he therefore intended to instruct officers to open discussions with parishes as to the impact of ending this payment from the 2019/20 financial year.

It was moved by Councillor Julian Cunningham, seconded by Councillor Mrs L.A. Needham and, following debate and upon being put to the vote, it was

RESOLVED:

(1)       That the Scheme attached at Appendix 1 to the report, be approved as the Council Tax Reduction Scheme (CTRS) for North Hertfordshire for 2018/2019;

(2)       That in accordance with Section 59A.1 of the Council Tax Reduction Scheme referred to in (1) above, the percentage by which each award to each recipient in the Non-Protected Groups be reduced at 25% for 2018/2019 (the same as for 2017/2018); and

(3)       That the amount to be distributed to the Local Precepting Authorities for Council Tax Reduction Scheme Grant is £38,885 and that this is distributed in proportion to the total awards of CTRS in each Local Precepting area.

REASON FOR DECISION: To comply with the requirement to approve the local Council Tax Reduction Scheme fro the coming financial year.