Decision details

Council Tax - Hardship Fund

Decision Maker: The Leader and Cabinet Member for Corporate Services and Transformation

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: Yes


Proposed arrangements for the allocation of the Government’s Council Tax Hardship Fund.


To allocate the Council Tax Hardship Fund in accordance with the Government’s guidance and to utilise the remaining grant to respond to any further hardship applications during the 2020/21 financial year.

Reasons for the decision:

As part of its response to COVID-19, the Government announced in the Budget on 11 March that it would provide local authorities in England with £500m of new grant funding to support economically vulnerable people and households in their local area.

The expectation is that the majority of the hardship fund will be used to provide council tax relief, alongside existing local council tax support schemes.  Guidance notes and a comprehensive Q & A has been released by Government on 16th April 2020 and confirmation of the grant allocation to authorities was provided.  For South Kesteven District Council, an allocation of £924k has been made based on the current working age caseload.

The guidance makes clear that there is a strong expectation that billing authorities will provide all recipients of working age local council tax support (‘LCTS’) during the financial year 2020-21 with a further reduction in their annual council tax bill of £150, using their discretionary powers to reduce the liability of council tax payers outside of their formal LCTS scheme design.

Furthermore where a taxpayer’s liability for 2020-21 is, following the application of council tax support, less than £150, then their liability would be reduced to nil. Where a taxpayer’s liability for 2020-21 is nil, no reduction to the council tax bill will be available.

There should be no need for any recipient of LCTS to make a separate claim for a reduction under this scheme. The billing authority should assess who is eligible for support from the hardship fund and automatically rebill those council taxpayers.

Financial modelling has been undertaken within the guidance requirements set out above and the following is an analysis of the impact:

            Analysis of Balance

Number of Working Age claimants

Hardship Allocation


Credit balance






Up to £150



Over 150







In summary there are 4,279 active working age claims and 2,253 (52%) will be eligible for hardship fund top up.  This will leave a balance of £591k to be utilised in the following order.

·                Setting aside an element of the grant to respond to further claimants during the course of the financial year in accordance with the guidance requirements

·                Further reductions of the eligible claimants referred to above should their residual Council tax liability be £50 or less for 20/21 after the £150 has been applied

·                Setting aside an element of the grant to respond to claims received that can be considered within principles set out in Council’s Discretionary Council Tax Payment Policy and the Section 13A Guidance.  Both of these policies allow discretionary powers to be used to discount any Council tax outstanding where there is evidence of financial hardship

Alternative options considered:

This option meets all of the requirements of the Government’s guidance and ensures there will be sufficient grant to meet the anticipated increase in hardship cases during the course of the financial year.  

Publication date: 11/05/2020

Date of decision: 11/04/2020

Effective from: 19/05/2020

Accompanying Documents: