Local Support for Council Tax The Consultation Document

Section 1 Introduction Spending Review 2010 Localise support for council tax by reducing benefit cost subsidy by 10% from Abolition of council tax benefit provision in the Welfare Reform Bill Claims it is part of wider policy giving councils increased financial autonomy The consultation sets out proposals on the “key elements” of a framework for reform Enabling power for the new scheme to be contained in a finance bill in the current parliamentary session

Section 2 Why localise support for council tax Give local authorities (LAs) a greater stake in the economic future of their area Give LAs the opportunity to reform the system of support for working age claimants Reinforce local control over council tax Give LAs a degree of control over how the impact of the 10% reduction Give LAs a financial stake in the suport for council tax.

Section 3 Overview of consultation Broad parameters Framework for support for eligible pensioners The importance of supporting incentives to work LAs encouraged to collaborate to reduce costs LAs to consider how system can be simplified for working age claimants LAs will seek to integrate arrangements for providing support within council tax system Reform accompanied by a new grant Proposals to create local mechanisms to manage financial pressures

Section 4 What changes to support for council tax could mean for you Targeted at council tax payers Informative Gives basic information on entitlement Warns of potential loss of benefit Clearly places the responsibility for developing the scheme on local authorities Clearly states that local authorities will make the decisions on entitlement

Section 5 Principles of the scheme Local authorities to have a duty to run a scheme to provide support for council tax in their area. For pensioners there should be no change in the current level of awards, as a result of this reform. Local authorities should also consider ensuring support for other vulnerable groups. Local schemes should support work incentives, and in particular avoid disincentives to move into work.

Section 6 Establishing local schemes Aligning arrangements for support with the wider council tax system Process for establishing schemes Design Consultation Budget and council tax setting processes Work incentives Adjusting the scheme over time

Section 7 Joint working Benefits of collaboration Reducing duplication and cost Joint design/administration Addressing needs and priorities that extend beyond the boundaries of the billing authority Types of financial risk Arrangements for, and types of, joint working

Section 8 Managing risk Local contingency arrangements Managing financial pressures with other authorities Billing authorities should be able to share any financial pressure as a result of unexpectedly high increases in demand for support with major precepting authorities. The billing authority should not be exposed to the totality of the financial pressure in-year. While risk sharing with precepting authorities will be the default approach, different forms of risk sharing should be possible.

Section 9 Administering local schemes Establishing eligibility and making a claim Providing certainty for claimants Granting the award Hardship Transitional protection Appeals Administrative arrangements for pensioners

Section 10 Data sharing Current arrangements Benefits of data sharing Data protection Fraud and error Current arrangements Changes to fraud and error investigation Future arrangements?

Section 11 Funding Framework that will deliver Certainty Incentives to manage down expenditure! The form of grant Restrictions on the cost of the scheme Basis for allocating grant, and frequency of adjustments, two options Reflecting as closely as possible levels of take-up or demand, by adjusting as frequently as is practicable to changes in these levels Leaving the grant allocation unchanged for several years

Section 12 Administrative costs Council Tax Benefit administration costs, the current approach Future funding for council tax rebate administration Joint working

Section 13 Transitional and implementation issues Three issues The wider context of welfare reform and in particular the changes to the administration of housing benefit; The process and timescales for designing new schemes and commissioning and procuring new systems; and Communicating changes to claimants Transition to new arrangements

Section 13 The Timetable (1) Summer 2011 Consultation begins. Government begins working with local authorities, representative organisations and suppliers on delivery requirements for localisation. Basis for model schemes considered. Autumn/winter Government publishes a response to the consultation. Introduction of Local Government Finance Bill (included provisions for localisation of council tax support). Central and local government begin working on model schemes. Spring 2012 Primary legislation in passage through Parliament. Government preparing and publishing draft secondary legislation.

Section 13 The Timetable (2) Summer 2012 Primary legislation passed. Secondary legislation prepared. Local authorities designing and consulting on local schemes. Autumn/winter Local authorities establishing local schemes – putting place systems, notifying claimants of changes. Local authorities setting budgets. Spring 2013 Local schemes in operation.