The Director of Strategic Resources submitted a report which sought approval to assist working age claimants who receive Local Council Tax Support through the Council Tax Exceptional Hardship scheme.
The report stated that in the Governments 2010 spending review it was announced that support for Council Tax (Council Tax Benefit) would be localised and the associated level of funding to Local Authorities would be reduced by 10%. This equated to a reduction in funding of £2.4 million for MIddlesbrough.
The Council agreed its own Localised Council Tax Scheme on the 9th January 2013. This passed on a £1.8 million (20% reduction) in Council Tax Support for people of working age. The remaining £0.6 million was met by a review of discounts and exemptions.
The report outlined that as part of the changes to the Local Council Tax Support Scheme, all working age residents are liable to pay a minimum of 20% of their Council Tax liability from 1 April 2013. From this date 13,785 working age residents had an increased amount of Council Tax to pay, of which 9,860 who previously received 100% Council Tax Benefit, were asked to pay Council Tax, potentially for the first time. The current number of working age residents who receive Council Tax Support is 13,974 and it is these residents who the proposals put forward will assist.
In April 2013 the Council received £483,272 from Central Government in respect of Discretionary Housing Payment (DHP). The intention of the funding is to help mitigate the impact of the Welfare Reform changes by providing support for those most in need This funding can only be utilised in the current financial year ending 31 March 2014.
In addition to the DHP funding, the Council also received approximately £954,000 from Central Government in relation to the Local Welfare Provision which was provided to help residents in emergency, crisis situations. This differs from the DHP funding, in that the Council could decide how to utilise this to the maximum benefit of Middlesbrough residents.
The grant has been used in a wide variety of scenarios to help Middlesbrough residents in emergency situations (such as providing help due to delays in benefit payments, help with payments to families with vulnerable children and also providing financial assistance to residents who are subject to restrictions in their Housing Benefit due to having a spare bedroom.
The Council has recently secured additional DHP funding of £120,000 and £80,000 on 19 December 2013 and 14 February 2014 respectively. The basis of the funding being to mitigate the impact of the £2.4 million reduction in Council Tax Benefit support.
Following revisions to the Council Tax Exceptional Hardship policy from 1 April 2013 which were approved by the Corporate Affairs Committee on 29 January 2014, the option is now available to apply the additional DHP funding to reduce the impact of the Council Tax Support Scheme and assist residents who are suffering hardship and experiencing difficulties in paying their Council Tax.
The report outlined the options appraisal, further details were stated in the report.
That the Executive support the use of available assistance for Welfare Reform funding to support residents of working age who receive Local Council Tax Support as outlined in the report.
The decision was supported for the following reason:
If this proposal is supported, the funding provided by Central Government will be fully utilised for the purpose it was intended. There is no cost to the Council and will assist residents with the impact of the Welfare Reforms.