Almost 300,000 low income households in the UK are set to be hit by a rise in their council tax payments by a total of £80 each year, a recent study of council attitudes has revealed. The Joseph Rowntree Foundation conducted a survey in order to gauge council’s response to the government’s removing its limit threshold, and found that almost 50 authorities are downgrading the level of aid provided to families struggling to make their payments.
Last year, the government announced that they would be cutting the level of finance given for means-tested benefits by half a billion pounds, and granted local councils the power to decide how the new finance would be passed on to applicants.
In order to protect people from the lower levels of funding, many councils implemented new schemes that allowed applicants to acquire a similar level of money from their benefits. However, it has been announced that these schemes will not be continued this year, meaning that the country’s lowest earners will have to find another way of coping with rising financial demands outside of the government.
And the Joseph Rowntree Foundation has identified that this will cost the average taxpayer an extra £78 each year on their payments, meaning that they will have to stump up almost £200 each year solely for their council tax.
Furthermore, official statistics have indicated that the number of people in arrears with their council tax debt had risen substantially since the system changes had been made, with almost 700,000 people being visited by bailiffs in the first half of last year.
Peter Kenway of the New Policy Institute, which conducted the research, said:
“The data published today, suggests that around a quarter of local authorities are amending their council tax support schemes for 2014-15. In almost all cases these changes will adversely affect working-age council tax support recipients. Those recipients affected will see their support further reduced by £78 on average per annum, more than doubling the average amount of council tax payable.
“Most of those amending their schemes were in receipt of the transitional grant funding. As this grant was available for one year only, many local authorities have decided to pass on more of the cut to vulnerable residents in order to make up the funding shortfall.”
The Local Government Associated, reserved an even more pessimistic forecast for the potential impacts of the rise, arguing that under current trajectory councils would be faced with almost 30% less finance to work with by 2015.
Hilary Benn, Labour’s local government spokesman, said: “Local government has faced the deepest cuts to any part of the public sector. We know as well that the poorest councils are facing the biggest reductions in their spending power.
“This new poll tax – the responsibility for which lies squarely at David Cameron and Eric Pickles’s doorstep – hits the poorest hardest, forcing up council tax bills for those least able to pay them.”
The government said that under Labour council tax bills had doubled. Brandon Lewis, the minister in charge of the policy, said: “Welfare reform is vital to tackle Labour’s budget deficit. Under the last administration, more taxpayers’ money was being spent on benefits than on defence, education and health combined.
“Our reforms to localise council tax support now give councils stronger incentives to support local firms, cut fraud, promote local enterprise and get people into work. We are ending Labour’s something-for-nothing culture and making work pay”.