Agenda item

An update will be provided by the Head of Finance and the Benefits Manager.

The Benefits Manager gave a presentation on updates to welfare reform and council tax benefit. The Government had asked councils to introduce local schemes, which would replace a single, national scheme. Localised schemes would be introduced from April 2013. A 10% reduction in expenditure was required; this would be realised through a reduced level of grant. Based on 2010/11 SKDC spent £7.25m a year on council tax benefit.

Initial consultation documents indicated that pensioners (defined as those in receipt of a state pension) were a protected group, however recent correspondence stipulated the protection would not apply to all pensioners; those who could afford to pay would pay. Other protected groups would need defining locally.

Based on research undertaken locally and nationally, (taking account of the 10% cut to expenditure and protecting certain vulnerable groups), projections indicated that non-protected groups could be required to contribute an additional 25% (approximately £340 based on current council tax levels) a year.

The service had seen an increase in the number of cases it administered. This trend was expected to continue and lead to increases in expenditure. When it set its policy, the Council would need to consider whether it would top up the grant or whether it would work within the grant, stopping benefits when the grant was spent.

The PDG was shown a projection of the numbers of people from specific vulnerable groups in receipt of council tax benefit. The groups typically classed as vulnerable in relation to council tax benefit were: passported (those in receipt of certain benefits who automatically had their council tax paid), lone parents, those in receipt of war pensions (one Councillor advised that from his experience of working with SSAFA, the number of claimants of war pensions had increased), carers and people with a disability. Projecting the caseload was complicated because there were overlaps between each group, which was not highlighted in the data.

Challenges were identified: defining vulnerable/protected groups (guidance was awaited regarding pensioners), the budget position was unknown, modelling different expenditure scenarios, deciding whether to ‘top-up’ the scheme, sourcing and procuring software to administer council tax and council tax benefit and promoting changes to those affected.

Members of the PDG discussed the presentation. Councillors were advised that if the Council did not adopt a local scheme, it would automatically enter a national scheme and face a further reduction in grant funding. It was unclear how funding would be distributed; one possible channel was through the county council. It was also unclear whether the grant would be paid in a lump sum or over several instalments.

One risk associated with changes was an increase in non-payment leading to an increase in council tax and rent arrears. The council would need to work with Lincolnshire County Council and Lincolnshire Policy Authority to develop a policy that took account of any losses should the council tax collection rate decreased. There was an expectation that schemes within the county should mirror each other as closely as possible.

The PDG agreed to consider policy options in more detail at a future meeting following discussions with Lincolnshire County Council and Lincolnshire Police Authority, and the release of further guidance clarifying the principles behind the new approach.