Telford & Wrekin Council consults on changes to Council Tax Support scheme

Telford & Wrekin Council says the changes are needed because of continuing cuts in council funding from Government – the Council must make £35 million of cuts from its budget over the next three years, after already cutting its budget by £70 million since 2010. That means that by 2019 total cuts will amount to over £100 million.

Changes in the law in 2013, replaced the National Council Tax Benefit Scheme with ones decided locally by councils.

Council Tax Support is paid to a wide range of people including working families in low paid employment, people who find themselves unemployed for short periods because of redundancy as well as the long term unemployed or people unable to work because of illness.

The proposals continue to seek to encourage people to work and remain in work, to reduce the impact on the most vulnerable, while helping the Council to make savings to support services for the elderly and children.

Pensioners, anyone classed as severely disabled or in receipt of war disablement or war widow pension will not be affected by the proposed changes.

The two key changes proposed to the Telford & Wrekin Council Tax Support scheme are:

Introducing a cap on the income from state benefits for people of working age (16-64). This would be set at £20,000 a year for couples and single parents with children living with them. For single people, the cap would be £13,400. This would be in line with limits set by government for the national housing benefit scheme from April 2016. Currently, there is no cap on the level of Council Tax Support people can receive. This change would affect around 100 people in the borough.

Introducing an estimated minimum weekly income level for working age self-employed people trading for more than 12 months. Starting a business can be hard, so the Council proposes allowing self employed people a 12 month period when no minimum income level will apply. After this, it proposes that a self-employed person’s minimum weekly income will be equivalent 30 hours at the National Minimum Wage for under 25s (currently up to £194/week) and the New National Minimum Wage for over 25s (currently £205/week), after tax and National Insurance. This minimum weekly income level will be used to work out a claimant’s Council Tax Support entitlement. This change would affect around 460 people in the borough.

The Council estimates that these changes would next year reduce its annual bill for Council Tax Support by £222,000 to around £11.8 million.

This saving is the equivalent to an extra 14,000 hours of home care to 18 vulnerable older people, helping them to stay in their homes or would fund emptying public litter bins in the borough for 19 months.

The Council’s consultation opens on 3 August and runs until 23 October and it is asking everyone to give their views on the proposals. This can be done online www.telford.gov.uk/counciltaxsupport

Councillor Lee Carter, cabinet member for finance, said: “Given the continuing cuts in Government grant and the £35 million we have to make on top of the £70 million of savings we have already made since 2010, we must look at every possible avenue for savings.

“We want our Council Tax Support scheme to be fair to everyone, to encourage people to find work and ensure that work pays and to support our most vulnerable citizens where possible.

“The proposed introduction of a cap on benefits to include Council Tax Support would bring this in line with national limits set for other benefits.

“Setting a minimum income level for self employed people would reduce the risk of any abuse of the system and ensure that benefits are paid to those most in need.

“We really want to hear the views of everyone in the borough on these changes, whether you’re receiving Council Tax Support or not, and we will consider these views before making any final decision on the scheme early next year.

“The proposed changes to our Council Support Scheme are another example of the very tough financial decisions that lie ahead. Telford & Wrekin is being dealt a very, very tough hand by the Government.”