Cuts to double?

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  • #45020
    pamrichardson
    Participant

    LGC 10 January, 2013 | By Ruth Keeling

    Cuts to localised council tax benefit are set to almost double and will reach 18% by 2014-15, it has emerged.

    Council leaders learned of a further 8.5% cut to council tax support – on top of 10% already announced – during a meeting with ministers held yesterday.

    Sharon Taylor (Lab), leader of Stevenage BC and chair of the LGA’s finance panel said the 8.5% cut in 2014-15, equivalent to £280m, was revealed during a meeting held on Wednesday with ministers and officials from the Department of Communities & Local Government.

    “That is not what we were expecting,” she said. The LGA has received verbal confirmation of the surprise cut since the meeting and intends to lobby against the move, she said, which comes on top of a 10% cut due to be applied in 2013-14.

    Cllr Taylor said it had been “made clear” in the meeting that the protection of pensioners from council tax benefit cuts would continue. This would mean cuts of more than 18% for other groups of claimants.

    The revelation has led to fears that council tax benefit funding will be phased out following its localisation from central to local government, due to take place in April.

    Mehboob Khan (Lab), leader of Kirklees MBC, said: “What’s really concerning is the…implications for council tax allowance in the future.” He told the LGA executive, meeting on Thursday, that sources close to the Treasury had suggested council tax benefit “would not be ring fenced” and was “likely to be reduced each year”.

    Cllr Khan said he had real concerns about the impact of reduced funding on households. “The implications of this are going to be absolutely dire,” he said 

    #126918
    Anonymous
    Guest

    Oh my god. Peter DLM can you email the DCLG for confirmation please?

    This is a truly bonkers way for a government to act. Some LA’s with larger pensioner caseload are going to have to charge 50% to passported claimants if this happens to be true. The poll tax riots will be a mere flesh wound in comparison to what will happen if this goes ahead. :tired: :tired: :tired:

    #126921
    pamrichardson
    Participant
    #126931
    seanosul
    Participant

    [quote=Iain Billinger]Oh my god. Peter DLM can you email the DCLG for confirmation please?
    [/quote]

    Support not being ring fenced was always going to be the case. The elements making up the Revenue Support Grant are disappearing and it LAs will need to become more reliant on their own revenue streams (such as the technical changes and their share of retained business rates).

    #126937
    peterdelamothe
    Keymaster

    I have it on good authority that no cuts wil be made next year and the full amount of 90% will be paid. I would have been suprised to see more of a hit just before an election especially because there are so many concerns about the impact of this policy.

    That does not mean the admin grant is safe of course….that is going to be a concern to many.

    #126938
    seanosul
    Participant

    [quote=peterdelamothe]That does not mean the admin grant is safe of course….[/quote]

    The grant is listed on the DCLG settlement page so that part at least is known.

    #126939
    Anonymous
    Guest

    Thanks Peter.

    Why do you think the Leader of Stevenage has made the comments that she has?

    #126942
    seanosul
    Participant

    Sounds like confusion about the 8.5% transition funding that will not be available. The long term point of the funding getting mixed in with the overall settlement is still relevant though.

    #126943
    peterdelamothe
    Keymaster

    No idea. It might be that DCLG raised it as a possibility or simply changed their position.

    However, I understand DCLG has clarified that the allocation for England will be £3.3bn in both 2013-14 and 2014-15 , in line with 90% of forecast CTB expenditure.

    #126945
    RobBox
    Participant

    DCLG have confirmed above by tweet………so a little birdie told me :bigsmile:

    #126952
    peterdelamothe
    Keymaster

    Now official:

    This communications update is being sent in response to a number of queries we have received following some media articles which suggest a further reduction in funding for local council tax schemes.

    That is not the case.

    There is no reduction in the overall funding for council tax support for 2014-15. The allocation for England is £3.3bn in both 2013-14 and 2014-15, in line with 90% of forecast CTB expenditure. Details of this are set out in Key Tables 3 of the Settlement documentation.

    http://www.local.communities.gov.uk/finance/1314/KT3_1314.xls and http://www.local.communities.gov.uk/finance/1314/KT3_1415.xls

    We have been clear for some time that funding for council tax support would be provided as part of the business rates retention scheme. Including the funding within the business rates retention scheme has been key to maximising the share of business rates and growth that is locally retained.

    The Government consulted widely over the summer on the basis for distributing funding between authorities. Council tax support funding will only be separately identifiable in 2013-14 allocations. From 2014-15, the level of council tax support funding and formula funding combined will be scaled back for individual councils according to their combined spending trajectory, by service tier.

    Ministers will of course consider all representations on individual authority allocations made during the current statutory consultation before making decisions on the final settlement.

    #126957
    seanosul
    Participant

    [quote=peterdelamothe]
    The Government consulted widely over the summer on the basis for distributing funding between authorities. Council tax support funding will only be separately identifiable in 2013-14 allocations. From 2014-15, the level of council tax support funding and formula funding combined will be scaled back for individual councils according to their combined spending trajectory, by service tier.[/quote]

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