Plans for new Local Council Tax Support scheme

A report is due to the council's next Cabinet on 26 July that will set out a range of options for a new Local Council Tax Support scheme.

National changes introduced by Government will include the abolition of the current national Council Tax Benefit scheme to be replaced by a Local Council Tax Support scheme to be determined by each local authority.

At the same Government is reducing funding - by 16% in real terms for Bristol, which means a shortfall of around £7.5 million. 

Proposals going before cabinet include the option of raising approximately £2.5 million through the Government’s relaxation of rules governing discounts and exemptions for empty properties and second homes.

The remaining amount - up to £5 million would be raised by the following options:

- Fully funded - to replicate the current Council Tax Benefit scheme with minimum changes and impact for claimants, i.e. the council would need to fund the full shortfall amount from its budget by cutting services elsewhere

- Part-funded - all non-vulnerable working age households would lose 12.5% (£2.5 million), therefore the council would need to fund the remaining £2.5 million from its budget

- Or all non-vulnerable households lose 25% - this equates to £5 million, therefore the council would not need to find anything further.

The Government has stated that all low income pensioners would be exempt from any changes.

The Council’s cabinet will be asked to give the green light for a 12-week consultation on these options, starting in August. The scheme will need to be up and running by April 2013.

Cllr Jon Rogers, Deputy Leader and Cabinet Member for Resources said: “This is new territory for local government, and even more challenging when we are faced with having to make 16% reductions in funding from the outset. This is why no one scheme for Bristol is recommended at this point to allow for a thorough consultation.

“However it is entirely sensible that we do look carefully at how we can make up part of the shortfall by looking at existing discounts and exemptions for empty properties and second homes. This is entirely in line with our long-standing and successful policy of getting more houses standing empty across the city back into use.”

Bristol currently pays around £40m each year in Council Tax Benefit to around 45,000 households, supporting 1 in 4 Bristol households.