Working families across the country are set to benefit from these
changes to the administration of council tax as government
unveils plans to modernise the billing process to make it fairer,
simpler and more supportive.
More manageable 12 monthly billing by default, action to crack
down on punitive punishment for missed payments and fairer
treatment for the most vulnerable households are all being
considered by the government in the biggest changes to the
operation of the council tax system since 1993.
The revamp could see better protection for those falling behind
on bills by stopping debts spiralling while potentially capping
the fees added to debt when going to court and changing when a
household may become liable for a full-year's bill.
The government is already reviewing debt enforcement practices
more widely including the conduct of bailiffs, that can be
deployed when council tax bills go unpaid, to deliver a fairer
system for those in need.
Minister for Local Government and English Devolution,
OBE
said:
“As part of our Plan for Change, we're putting working people
first.
“We are listening and taking action to make council tax fairer,
more transparent and easier to manage. Under our plans, local
government will be there to support, and not to punish, people
who fall behind.”
Today's move follows a long running campaign by
MoneySavingExpert.com founder and his charity the Money and
Mental Health Policy Institute (MMHPI) which have called for
action on the "outdated” escalation that can happen when someone
falls behind with their Council Tax payments.
, founder of
MoneySavingExpert.com and The Money & Mental Health Policy
Institute Charity, said:
“Many parts of the Council Tax system are broken, and having
called for some of these fixes for nearly 20 years, I'm delighted
the government has listened and rapidly launched this long-due
consultation, including many of the administration areas I hear
the most complaints on.
“Council Tax rapid and aggressive debt collection methods
currently hurt millions and disproportionately affect those with
mental health problems. Within three weeks of missing a monthly
payment many councils say you must pay for the whole year…
ridiculous, how can people who can't afford to pay for a month,
suddenly pay for a year? After a further three weeks councils can
call bailiffs in and rack up charges on charges. No commercial
lender is allowed to behave like this, meaning constituents are
treated worse than consumers. Worse, it's counter-productive, can
add to council's costs and still doesn't mean people can pay it
back. The government has listened to our evidence, and this
consultation thankfully looks at slowing it down, adding-in
consideration, capping added costs, and pointing people towards
help to pay.
“Plus, as council tax bands haven't been revalued since the
stop-gap drive-by valuations first done back in 1991 – while
looking at that isn't in the scope of this consultation – it's
only right that if people think they're wrongly in too high a
band, as 100,000s likely are, the government is consulting on
making it easier to challenge, so people can pay the right price.
The consultation is also proposing help for some of the most
vulnerable – we've long campaigned on the horribly-named Severe
Mental Impairment discount, which is underclaimed, overcomplex
and underpublicised, and this gives an opportunity to move
towards a simpler, more universal, less off-putting application
process.”
To help vulnerable families manage bills, the government intends
to move billing to 12 monthly payments by default, rather than
the current 10 monthly, this will spread the annual cost across a
longer period meaning lower monthly payments for the average Band
D household's bill by £38 per month. This consultation is part of
wider action being taken to support the financial resilience of
families in our Child Poverty Strategy.
The government plans to modernise support available, including
updating the definition of the Severe Mentally Impaired exemption
and reviewing whether current disregards for care workers and
apprentices could be improved. Providing more information on what
council tax bills are paying for and how to increase awareness of
the support available is also being explored to boost
transparency.
Council tax is essential for funding over 800 vital public
services delivered by local authorities daily – but it has failed
to keep pace with the changing needs of taxpayers. A renewed,
more supportive, council tax billing system will enable
households to better manage their bills, keep up with payments
and help councils deliver improved front-line
services.
ENDS
Notes to Editors
- Minister McMahon Written Ministerial Statement can be read
here.
- The consultation can be viewed on Gov.uk here and will be
open for 12 weeks.
- The Ministry of Justice is also consulting on the regulation
of the debt enforcement sector (private bailiffs). Local
authorities sometimes use bailiffs when council tax bills go
unpaid. The consultation is open until the 21 July and can be
found here.
