Brent Council is to consult on proposals that would cut the current Council Tax Support scheme by £3.3m. The proposals are for three potential options  1) an increase of 19% claimant contribution (the percentage of the full Council Tax that the resident actually pays) for all working age claimants including the vulnerable who are currently exempt; 2)  current exempt remain protected but working age non-exempt will pay 51% of the Council Tax;  3) taper off entitlement as income rises so that the number claiming is reduced.

The Council is set to increase Council Tax by 5.99% in the financial year 2019-20. These proposals would take effect in 2020-21 with consultation on the changes taking place between June and September 2019 and going to Full Council in December 2019.

It is worth noting that the report to Monday's Cabinet commits to an equitable scheme but notes under Equality Impact Screening that:

...That said, there is a potentialrisk of a disproportionate impact in certain groups, in particular disabled people, ethnic groups and (possibly) gender.

Extract from the Report to Cabinet

£3.3M net saving (£3.96M gross)

i.                Additional 19% claimant contribution for all working age claimants. Current exempt (“vulnerable”) claimants pay 19%; non-exempt claimants pay 39%;

     Or:

ii.              Current exempt claimants remain protected; additional 31% claimant contribution for all non-exempt working age; i.e. Non-exempt claimants pay minimum 51% of Council Tax liability.

      Or:

iii.             Introduce mechanisms to taper off entitlement more steeply as income rises, therefore making the saving from reduced caseload volumes, rather than the rebates that the remaining claimants receive.

The above options all represent extremes which are unlikely to exactly represent the eventual scheme design, which will be more nuanced, with many aspects – in particular those claimants treated as “exempt” - under review and likely to be changed. However they illustrate the difficulty in maintaining the current size of caseload while attempting to protect the most financially vulnerable. The new scheme is therefore most likely to incorporate option (iii) to either fully or partially meet the saving while allowing the scheme still to protect the most financially vulnerable within it.

Key risks and mitigations

The Council must be able to show that meaningful consideration has been given to meeting the saving from alternative measures, e.g. increasing Council Tax, cutting other services, etc., and why it is proposing to meet the saving by changing the CTS scheme. If it cannot show this, it leaves itself open to significant legal challenge.

·      Ensure that consultation includes meaningful consideration of the of alternative funding methods to meet the saving 


·      Ensure that Cabinet and Full Council reports explore the alternative funding methods in sufficient detail and evidence that that Members have actively considered these 
Financial hardship for residents – 


·      the scheme will be designed to protect the most vulnerable, but will 
necessarily will overall be harsher than the current scheme 


·      consideration of a discretionary hardship fund within the scheme 


·      consideration of transitional protection for the most impacted claimants 


Council Tax collection decreases –
- review Council Tax collection processes to enable greater engagement with CTS claimants before enforcement action commences

Scheme is not agreed by Full Council by the deadline – - robust project management

IT systems unable to provide the desired solution (on time) –
- early engagement with IT providers and strong project management

Scheme is subject to legal challenge –

·      robust scheme modelling 


·      engagement with stakeholders 


·      sufficient time taken over drafting the formal scheme with Legal Services input 
Revised scheme does not deliver sufficient savings and / or further cuts required in following year

·      model alternative schemes including one providing a larger cut 


·      design a scheme with further changes for Year 2 built into it

 Equality impact screening


The proposed scheme has not been designed yet and there are several options, so it is not possible to be precise at this stage, however one of the design principles is to build a scheme that is equitable and proportionate across protected groups (and other claimants), so specific impacts will be tested in due course and any inequities reviewed accordingly. That said, there is a potential risk of a disproportionate impact in certain groups, in particular disabled people, ethnic groups and (possibly) gender. There is considered to be a much lower risk in the other protected groups, as no potential scheme designs will feature these factors explicitly, and the chance of an unintended consequence is thought to be low – although all aspects will be considered in the EIA.