Report of the City Treasurer

The purpose of this report is to provide final recommendations for the Council’s Council Tax Support Scheme from April 2019 for the Executive to consider.  The report proposes changes to the Council’s Council Tax Support Scheme. The changes are proposed so that the scheme remains fit for purpose as working age residents in receipt of welfare benefits are moved onto Universal Credit.  The report follows a period of formal consultation on the proposals that change the scheme for working age residents in receipt of Universal Credit.

The Committee considered a report of the City Treasurer, which detailed the final proposals for the Council’s Council Tax Support Scheme (CTSS) from April 2019.  The report proposed changes to ensure that the scheme remained fit for purpose as working age residents in receipt of welfare benefits were moved onto Universal Credit.

The Director of Customer Services and Transactions referred to the main points and themes within the report which included:-

•           The background to the current local Council Tax Support Scheme for the Council;

•           The impact of Universal Credit on Manchester residents and its impact on Council Tax Support;

•           What impact the proposed changes would have on Manchester residents;

•           The cost of the proposed changes;

•           Financial modelling and impact of a banded scheme;

•           The outcome of the consultation exercise with Manchester residents; and

•           Key policies and considerations, including any legal considerations in relation to the proposed changes.

The Committee had been invited to comment on the report prior to its submission to the Executive on 13 February 2019.

Some of the key points that arose from the Committees discussions were:-

•           Members unanimously supported the proposed changes to the Council’s CTSS in order to continue to deliver a scheme that was cost effective and provided optimum support to low income households within the available budget;

•           How much additional funding would be required to deliver the proposed changes to the Discretionary Council Tax Payment Scheme in order to support those families where the government changes have had the most significant impact;

•           How would these additional families who required support be identified;

•           How will the Council standardise this support and incorporate it into Council policy;

•           What opportunity was there to present a case to the DWP to change their ICT system to flag those individuals and or families that were entitled to Council Tax Support;

•           Was there a trend of larger families moving into Manchester;

•           It was pleasing to see that the number of Band H properties in the city had doubled in number and only eight of these were empty, which would result In more Council Tax income for the Council; and

•           Was it possible for the Council to ask the DWP to advise claimants to always claim Council Tax support.

The Director of Customer Services and Transactions advised that an additional £150,000 was being invested into Discretionary Council Tax Payment Scheme to provide support to those additional families where the government changes had had the most significant impact and that this funding would be requested to be maintained in future budgets.  The Council will identify those households affected by the Government’s two child limit legislation and the impact of moving to a banded scheme.  It was estimated that the cost to provide this additional support would be £125,000 and a further £25,000 had been set aside to deal with any other cases that occurred which would be considered on their own merits.  Everything that had been mapped had been based on the affordability of the scheme and the support available.  Officers would identify cases from their systems and where households were identified as losing a set weekly amount, an adjustment would be made to make up their Council Tax Support.  Residents would not be expected to apply for this support.  Eligibility for the funding would be for those families that had a weekly loss of £1 or more in the new banded scheme and anyone who lost £2 or more in the two child limit.  An initial number of families would be identified for receipt of this support from April 2019 and then officers would run regular reports throughout the year to identify other families who would be affected by the two child limit.  It was also reported that the Council had updated its policy document relating to the Discretionary Council Tax Payment Scheme so that it specifically referenced these groups of people.

Officers advised that at a local level, there was a Universal Credit Partnership Manager who the Council was able to raise its preferences through.  The Council had regular communication with the DWP, however, getting views considered by the DWP at a national level was challenging and there was also an issue of data sharing and data protection limiting the personal information of claimants the DWP can share.

It was reported that the Council’s Revenues and Benefits team did not monitor where families moved into Manchester from and just dealt with families that they were presented with.

The Committee was advised that the Council could ask the DWP to advise claimants to always claim Council Tax Support but there was no guarantee that they would deliver this on a consistent basis.

Decision

The Committee endorses the recommendations contained within the report that the Executive:-

·                Note the outcomes of the consultation process and the Equality Impact Assessment (EIA) both of which have supported and informed the final recommendations.

·                Agrees to make the following changes to the Council Tax Support Scheme from 1 April 2019 in respect of people entitled to Universal Credit.

·                A person for whom the Council receives both an electronic notification of a new claim for, and subsequently a related first payment of, Universal Credit from the Department for Work and Pensions shall be deemed to have made a claim for a reduction under this scheme on the first day of entitlement to Universal Credit to which that notification of first payment refers.

·                The amount of an award in respect of a day under this scheme for a person entitled to Universal Credit shall be a percentage of the amount set by the authority as the Council Tax for the relevant financial year in respect of the dwelling in which he is a resident and for which he is liable. This is subject to any discount which may be appropriate to that dwelling under the 1992 Act, divided the number of days in that financial year, less the daily rate of any deductions in respect of non-dependants which fall to be made. That percentage shall be the percentage specified in the following table according to the band in which their excess income falls.

·                People who have a temporary break in their Council Tax Support (up to six months) because an associated award of Universal Credit has ended or the amount of Universal Credit in payment rises to a level that ends entitlement to Council Tax Support and that award of Universal Credit is subsequently reinstated (whether at the same rate or at a different rate) or drops to a level that triggers eligibility for Council Tax Support, are required to make a new claim for Council Tax Support. A new claim in these circumstances shall be treated as made on the date on which entitlement to Universal Credit resumed / reduced or six months before the day on which the claim is actually received, whichever is the later.

·                The Council will monitor and review the Council Tax Support Scheme to ensure that it continues to support the Council's policies. The Council Tax Support Scheme may be amended for subsequent years, but should this happen there will be further consultation. If no revised scheme is published, this scheme will continue to apply to subsequent years. However, the figures set out in the scheme in respect of applicable amounts, income and capital disregards and non-dependants deductions may still be uprated to allow for inflation. Any such uprating will take effect on 1 April each year. If the figures provided in the prescribed requirements change, the Council reserves the right to amend the figures quoted in the scheme without further consultation.

·                Where the Council receives notification from the Department for Work and Pensions of a change to Universal Credit and the changed assessment does not result in an alteration to the amount of a reduction under this scheme, the Council is not required to notify the claimant of its recording of that change.

·                Agree that the Council’s Discretionary Council Tax Payment Scheme is used to support households during the transitional period of moving to the banded scheme and Universal Credit. The scheme would cover the current anomalous and exceptional circumstances as well as supporting those households disproportionately impacted by Universal Credit transfer including families with children.