12 December 2018


Council Tax Reduction Scheme 2019-2020


Final Decision-Maker

Full Council

Lead Head of Service/Lead Director

Stephen McGinnes

Mid Kent Services Director

Lead Officer and Report Author

Sheila Coburn

Head of Revenues and Benefits Partnership



Wards affected



Executive Summary


Each year Full Council has to approve the Council Tax Reduction Scheme for the following year.


Where there are changes proposed, it is necessary for a public consultation to take place, requiring an early decision on any proposed changes.


This report recommends there are no changes to the current scheme for 2019-2020 for the reasons set out in paragraph 3.1.



The Policy and Resources Committee made the following recommendation to Council:


That the 2019-20 Council Tax Reduction Scheme (attached as Appendix 1) is approved.







7 August 2018

Policy & Resources Committee

19 September 2018


12 December 2018

Council Tax Reduction Scheme 2019-2020






1.1     The Council Tax Reduction Scheme (CTRS) was introduced in April 2013 as a replacement for Council Tax Benefit (CTB), a national scheme administered on behalf of the Department for Works and Pensions (DWP).


1.2     Each year the scheme must be approved by Full Council.


1.3     Any changes to the scheme for any year have to go for public consultation before being approved.


1.4     Since its introduction in April 2013, our local scheme has been ‘refreshed’ annually for prescribed statutory changes.


1.5     The scheme is ‘underpinned’ by the Kent-wide agreements, which recognises that all Kent districts (as the billing authorities) will seek to have a common ‘platform’.


1.6     From 1 April 2017, Maidstone Borough Council received no Revenue Support Grant from the Government in relation to the cost of the scheme. This was the catalyst for the scheme to be reviewed for 2017-2018.


1.7     As a result, 6 changes to the scheme were introduced for 2017-2018 from 13 options that were identified:


Option 1 - Reducing the maximum level of support for working age applicants from 87% to 80%

Option 2 - Removing the Family Premium for all new working age applicants

Option 5 - Reducing the period for which a person can be absent from Great Britain and still receive Council Tax Reduction to four weeks

Option 11 - Removing the work related activity component in the calculation of Council Tax Reduction

Option 12 - Limiting the number of dependent children within the

calculation for Council Tax Reduction to a maximum of two

Option 13 – Introducing a scheme, in addition to Council Tax Reduction, to help applicants suffering exceptional hardship



1.8     The remaining 7 options were not introduced for 2017-2018 and on 26 November 2016, Policy & Resources Committee recommended to Council that the 7 options below were rejected after considering the potential impact of the proposed changes on working age claimants with the protected characteristics of disability, age and sex, under the Equalities Act (2010).






Estimated annual saving

(all precepting authorities)

Option 3 - Reducing backdating to one month

Backdated awards are only granted where good cause is shown for the delay in claiming. Restricting the period claims can be backdated could disproportionately impact on disabled residents and those residents requiring assistance to claim.


Option 4 - Using a minimum income (notional income) for self employed earners after one year's self-employment

Residents that are unable to earn a reasonable income through self employment (equivalent to 35 hrs at minimum wage) following 12 months of trading should be encouraged to seek paid employment in order to become more financially independent. Allowances to be made for customers with caring responsibilities that prevent 35hrs work.


Option 6 - Reducing the capital limit from the existing £16,000 to £6,000

Capital limit of £6,000 represents a reasonable amount to be held in savings for emergencies. (3 months income). With a significant number of residents believed to hold less than £6,000 savings, any higher allowance could be perceived as unfair to those residents meeting the cost of the scheme through their Council Tax.


Option 7 - Introducing a standard level of non-dependant deduction of £10 for all claimants who have non-dependants resident with them

A single rate of deduction provides an incentive to take employment and increase income, with no increased contribution required as earnings increase. A standard deduction is less intrusive with no evidence of income required for other household members, also easing administration for the council.



Option 8 – Taking any Child Maintenance paid to a claimant or partner into account in full in the calculation of Council Tax Reduction

Levels of child poverty are projected to increase as a result of wider welfare reform changes. Introducing child maintenance as income within the calculations of CTR on top of those changes would contribute to higher levels of child poverty.



Option 9 - Restricting the maximum level of Council Tax Reduction payable to the equivalent of a Band D charge

99% of residents in receipt of CTR and 71% of all residents live in a property in band D or below. Subsidising Council Tax charges above the value of band D could be perceived as unfair to those residents meeting the cost of the scheme through their Council Tax.



Option 10 – Removing Second Adult Reduction from the scheme

Second adult rebate does not consider the means of the main householder to meet the Council Tax liability. Where the main householder is on a low income they would be able to claim independently for CTR.





1.10  The current scheme for 2018-2019 was approved by Full Council in

 December 2017, with no changes being made to the scheme apart from  

 technical changes to allow for the introduction of Universal Credit later this




1.11  Council Tax Reduction provides financial assistance in the form of a rebate

 on the Council Tax bill and this has reduced over recent years.


 2016/2017                £10,679,971


 2017/2018                £10,264,000


 2018/2019                £ 9,058,176 (estimated)


 2019/2020                £ 8,247,000 (estimated)


1.12     Collection for the amount of Council Tax billed to customers in receipt of

    Council Tax Reduction remains high with the following percentages being

    collected since the introduction of a local scheme in 2013:


     2013/2014  74.50%


     2014/2015  80.90%


     2015/2016  81.83%


     2016/2017  83.10%


     2017/2018  82.69%



1.13 The Council has an Exceptional Hardship Policy to support our most

        vulnerable customers who have seen a reduction in the amount of support

        they receive or are suffering financial hardship.


1.14   The Policy is referred to in documentation sent to customers and on the

     Council’s website, and the Citizen’s Advice Bureau and Debt Advice

     Agencies are aware of the Policy.


1.15   With Central Government funding for council services due to reduce

 significantly after 2019-2020, fundamental changes will need to be

 considered to the Council Tax Reduction Scheme for 2020-2021.


1.16   It is therefore intended that no changes are made for 2019-2020 for

     the following reasons:


·         Members considered the impact of other options identified to be too great when they made the decision on the scheme for 2017-2018, with no material change in impact anticipated.

·         The impact of the introduction of Universal Credit on 21 November 2018 will represent a significant change for households in receipt of welfare benefits.

·        Significant changes are expected for 2020-2021 and there has been a year

  on year reduction in the cost of Council Tax Reduction a result of earlier

  changes and a reduction in caseload.

·         The Council has a policy in place to help those households who are experiencing financial hardship.







2.1     Option 1 – maintain current scheme.


2.2     Option 2 – revise the scheme.  However this is not recommended because if Council does not agree to the recommendation, there would need to be a public consultation on the options available in 1.9 or a scheme otherwise determined by Council. A meaningful consultation would not be possible to undertake within the remaining time left in the Municipal year.






3.1     Option 1 is the preferred option for the reasons set out in 1.13.

3.2     The Policy and Resources Committee considered this issue at its meeting of 19 September 2018 and resolved the following:


That Council is recommended to carry forward the 2018-19 Council Tax Reduction Scheme to 2019-20 with no changes to the scheme.

3.3     The 2019/20 scheme is therefore attached as Appendix 1 to this report.



4.       RISK

4.1    The risks associated with this proposal, including the risks if the council does not act as recommended, have been considered in line with the Council’s Risk Management Framework.





5.1   Depending on the decision of council a public consultation may need to take place.





6.1     The final decision at Full Council will be notified to those households affected and key stakeholders.










Impact on Corporate Priorities

The council needs to balance

the needs of low income

households with the wider

interest of local taxpayers to

ensure that vulnerable

residents are protected

whilst providing a scheme

that is affordable.

Sheila Coburn, Head of Revenues and Benefits Partnership

Risk Management

The risks associated with implementing and operating the scheme are not considered high.

Endorsement of a scheme helps reduce the risk

Sheila Coburn, Head of Revenues and Benefits



CTR reduces the amount of

Council Tax that can be

collected. The cost of the scheme is met in full by the

council and preceptors.

The cost of the scheme has been reducing year on year.

Finance Team


No impact


Sheila Coburn, Head of Revenues and Benefits Partnership


Section 13A of the Local Government Finance Act 1992 requires the Council to adopt a Council Tax Reduction Scheme. Schedule 1A of the Act requires the Council to consider whether to revise or replace its scheme for each year. 


The Act contains a statutory duty to consult on a proposed scheme, with guiding principles for fair consultation set out in case law. As the proposed 2019-2020 scheme is unchanged from the current year 2018-2019, and consultation took place in 2017, no further consultation is necessary


 Keith Trowell, Team Leader (Corporate Governace), Legal Services

Privacy and Data Protection

It is recognised the recommendation will impact on what information the Council holds on its residents.


The data will be held and processed in accordance with the data protection principles contained in Schedule 1 to the Data Protection Act 1998.


 Keith Trowell, Team Leader (Corporate Governace), Legal Services


The recommendation does not propose a change in service therefore will not require an equalities impact assessment


Equalities and Corporate Policy Officer

Crime and Disorder

No impact

Sheila Coburn, Head of Revenues and Benefits Partnership


No impact

Sheila Coburn, Head of Revenues and Benefits Partnership




Appendix 1 – 2019/20 Council Tax Reduction Scheme