Agenda item

To receive a report from the Director of Finance, Resources & Customer Services presenting the Council and Business Rate Tax Base for approval and updating members on proposals for Local Council Tax support scheme.

TO FOLLOW

(Report No.138A)

(Key Decision – Reference No.3588)

Members are asked to note that Cabinet are also due to receive an update on the scheme on Wednesday 23 January 2013.  Any comments made as a result of this will be reported to the Council, in order to inform consideration of the above item.

Councillor Stafford moved and Councillor Taylor seconded the report of the Director of Finance, Resources & Customer Services (No.138A) presenting the Council and Business Rate Taxbase and seeking approval on an option for introduction of a local Council Tax Support Scheme.

NOTED

1.      The need to set up a local Council Tax Support Scheme had arisen as a result of the Government replacing the national Council Tax Benefit scheme with local schemes of support.  The Council was required to approve a local scheme of Council Tax support by 31 January 2013.  If the deadline was not met the Government’s Default Scheme would be imposed.

2.      The changes to Council Tax Benefit were being progressed as part of the wider package of Welfare Reform changes by the Government but would involve a significant change in view of the fact that:

a.      they had been accompanied by a reduction in Government grant funding for the scheme.  This would involve the Council having to fund a net deficit of £4.0m (after Council Tax technical changes for 2013/14 had been taken into account) compared to the current benefit regime; and

b.      the risk of any increase in caseload would be borne locally and would not attract additional grant funding.

3.      The Council had, as required by law, consulted the Greater London Authority and local residents on a draft local scheme and the options available, as detailed within section 4 of the report.

4.      The scheme model options available for consideration, as detailed within section 4.7 and Appendix A of the report along with the Equalities Impact Assessment that had been undertaken on each option as detailed in section 6 and Appendix H of the report.

5.      In addition, consideration had also been given to the Governments one year Transitional Grant Scheme, which had been announced on the final day of the consultation period, as detailed in section 5 of the report.  Whilst providing a one off grant of £670k, if an 8.5% limit on reduced support was applied and various other criteria were met, this had been calculated to create a funding shortfall of £805k in 2013/14 rising to £1.5m in 2014/15.

6.      The difficult nature of the decision needing to be made, given the potential need to pass on any reduction in support in terms of families and individuals in receipt of the benefit on low income.

7.      The amendments to the report, as detailed on the amendment sheet tabled at the meeting.

8.      As a result of the consultation process and consideration given to the scheme options available, the Cabinet member for Finance & Property advised that Option B (fully funded percentage reduction 19.5%) was being recommended for approval.

9.      The intention to establish a hardship scheme, as detailed within section 7.2 of the report.

10.    The concerns highlighted by the Opposition Group in relation to:

a.      The limited notice provided by the Majority Group on the recommended model scheme option being proposed for consideration; and

b.      The outcome of the consultation process on the scheme options, given its challenging nature in terms of the technical complexity of the changes being presented for consultation purposes.

Councillor Rye then moved and Councillor Prescott seconded, an amendment to the recommended Option B which sought approval to the Transitional Grant Scheme as the recommended option.  This was on the basis that it would enable the Council to accept the transitional relief funding on offer for the current year whilst allowing a more comprehensive consultation on the changes to the system to be undertaken.

Following a debate, the amendment was put to the vote and lost with the following result.

For: 23

Against:32

The debate then continued on the substantive motion to recommend Option B as the local scheme and after a period of further consideration the recommendations were put to the vote and agreed as follows:

AGREED

(1)    To approve Option B (19.5% Percentage reduction) detailed within section 4.7 of the report, as the Council Tax Support Scheme for 2013/14 along with the technical drafting changes required to the scheme regulations, as detailed within Appendix A of the report.

For: 32

Against: 0

Abstain: 22

The remaining recommendations within the report were then considered individually and agreed as follows, without a vote:

(2)    To approve the Council Tax technical changes relating to Option B, as detailed within section 8.1 and Appendix B of the report.

(3)    To approve the 2013/14 council tax base (87,557) relating to Option B, as detailed within Appendix C of the report

(4)    To approve the NNDR1 2013/14, as detailed within Appendix D of the report, and delegate the agreement of future business rate estimates made in the annual NNDR1 return to the Audit Committee in line with the normal practice for the Council Tax base estimates.

(5)    To note the collection arrangements, measures proposed to assist customers affected by the change in help with Council Tax payment and current payment methods, as detailed within Appendices E & F of the report).

(6)    To note the proposed arrangements for tackling fraud and error in Council Tax support, as detailed in Appendix G of the report.

(7)    To note the Equalities Impact Assessment, as detailed within Appendix H of the report and full consultation results, as detailed in Appendix I of the report.

(8)    To delegate authority to the Director of Finance, Resources and Customer Services to create and manage a hardship fund (as detailed in section 7 of the report) in agreement with the Cabinet Member for Finance & Property.