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Proposal to make changes to the Council Tax Reduction Scheme; moving from a means tested assessment to an income banded reduction scheme from 2019/20

Last updated 8 October 2019


The assessment
Action Plan


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The assessment



New or existing service or policy?


Officer(s) completing the assessment

  1. Lucy Wright, Revenues, Benefits and Customer Services Manager
  2. Tracey Southall, Corporate Director: Resources

Relevant Cabinet Member

Councillor Nathan Desmond, Cabinet Member for Resources

What is the purpose and expected outcomes?

The Council Tax Reduction Scheme (CTRS) provides assistance to people on low incomes to help them pay their council tax.

When council tax benefit was abolished and replaced by localised council tax schemes in 2013, central government protected pensioners with a view that they are unable to take advantage of employment and unable to alter their financial situation.

The proposed alterations to the scheme will continue to protect pensioners who will get the same level of council tax support as they do now. The proposals to change the CTRS from 2019/20are as follows:

  • Move to an income banded scheme instead of a means tested benefit. Claimants will fall into one of 4bands depending on their household income. The grid has been developed to include single people, couples, families with 1 child and families with 2or more children. Each band has 4 income brackets which entitles the claimant to either a 80%, 60%, 40% or 20% reduction in their Council Tax.
  • The scheme allows for variation in the size of the household as the levels of income per band increase when an applicant has a partner and/or dependants.
  • The proposed scheme does not apply a deduction for non-dependants living in the household. This is a significant change which will benefit those with non-dependants living in the household while simplifying the scheme for administration purposes such as low income households with adult children who live at home.
  • A standard earnings disregard will be applied across all claimants of £25. This will encourage people to move into work.
  • Current income disregards will continue such as Disability Living Allowance, Personal Independence Payments, the support component of Employment Support Allowance, Carer’s Allowance, war pensions, war disablement pensions, child benefit and child maintenance payments.
  • The capital limits before entitlement is stopped will be £6,000.
  • Extended payments and student provisions will be removed.

Will there be any effect on other Council procedures or strategies e.g. Corporate Plan or the council’s workforce?


Are there any statutory requirements or implications?

The Local Government Finance Act prescribes details of the scheme to be used for pension age applicants under the Council Tax Reduction Scheme (Prescribed Requirements) Regulations 2012.Certain aspects of the scheme for working age applicants are also included within those regulations.

Are there any other organisations/bodies involved?


Who are the main customer groups/stakeholders affected?

All households are liable to pay council tax. However the level of financial support they receive is up to the Council to decide under their local scheme regulations.

The current scheme provides 100% support for low income pension age claimants and 80% support for low income working age claimants, meaning all working age households have to pay a minimum of 20% of their council tax bill.

The Cabinet stated that they were not minded to change the level of support for working age claimants before 2019/20 however central Government have made changes to housing benefit, tax credits and universal credit. The proposed changes will affect some claimants –22% of households may see an increase in their entitlement while 11% may see a reduction due to their income levels. The current Council Tax Reduction Scheme working age case load is approximately 4,822.

What information/statistics/evidence are you using?

Due to changes made by central government from 2013 all local authorities were required to create a local scheme to replace council tax benefit. If the Council wish to consider making any changes to the scheme, there is a legal requirement to undertake a consultation.

A public consultation was carried out between 23 July and 28 September 2018. All comments are included in the Cabinet report dated 13 November. There were no comments that required inclusion in the equality impact assessment. 95% of respondents agreed to protect disabled claimants with an additional disregard.

What impact does the service/policy/project have on the nine protected characteristics as defined by the Equality Act 2010.

Prior to the Equality Act 2010, there were 3 separate public sector equality duties covering race, disability and gender. The Equality Act 2010 replaced these with a new single equality duty covering the protected characteristics listed below.

Characteristic and definition Impact and evidence

Age - where this is referred to, it refers to a person belonging to a particular age (e.g. 32 year olds) or range of ages (e.g. 18 - 30 year olds).


Evidence: While the changes will impact negatively on some new working age claimants the majority will be affected positively as they will receive more entitlement whereas pensioners are protected so the impact is not considered to be significant. The retention of a discretionary exceptional hardship fund that will support low income working age claimants will mitigate the impact on working age households that are unable to pay the liability or who are detrimentally affected.

Current caseload shows that 50% of our caseload is working age and 50% are pensioners.

Disability – a person has a disability if s/he has a physical or mental impairment which has a substantial and long-term adverse effect on that person's ability to carry out normal day-to-day activities.


Evidence: The proposed changes to the scheme ensures disabled claimants will be protected by continuing to disregard disability income in addition to increasing claimants’ income bands.

There are 285 disabled claimants within the caseload profiled. 186 claimants should see no impact as they will continue to be protected. 67 claimants will benefit from the proposed changes and 32 claimants could see a reduction in the support they receive. Any increases/reductions in levels of support will not be due to disability but due to other changes proposed that will apply to all claimants.

Gender reassignment – the process of transitioning from one gender to another.

No impact.

Marriage and civil partnership – marriage is defined as a 'union between a man and a woman'. Same-sex couples can have their relationships legally recognised as 'civil partnerships'. Civil partners must be treated the same as married couples on a wide range of legal matters.

No impact.

Pregnancy and maternity – pregnancy is the condition of being pregnant or expecting a baby. Maternity refers to the period after the birth, and is linked to maternity leave in the employment context. In the non-work context, protection against maternity discrimination is for 26 weeks after giving birth, and this includes treating a woman unfavourably because she is breastfeeding.

No impact.

Race – it refers to a group of people defined by their race, colour, and nationality (including citizenship) ethnic or national origins.

No impact.

Religion and belief – religion has the meaning usually given to it but belief includes religious and philosophical beliefs including lack of belief (e.g. Atheism).

No impact.

Sex – a man or a woman.

No impact.

Sexual Orientation – whether a person's sexual attraction is towards their own sex, the opposite sex or to both sexes.

No impact.


e.g. Deprivation, health inequalities, urban/rural divide, community safety


Evidence: Council Tax Reduction is a discount that is available to low income households. It is on this basis that all working age recipients would be at a socio-economic disadvantage in particular lone parents, part-time workers and carers.

The retention of a discretionary exceptional hardship fund that will support low income working age claimants will mitigate the impact on working age households that are unable to pay the liability or who are detrimentally affected by the proposed changes.

Can any differential impact be justified? (e.g. promoting equality of opportunity)


Evidence: When creating the local scheme, the Council have given due regard to central government’s stipulation that people of pension age must be protected. In a public consultation undertaken in 2012, the principle of ‘Every household with working age claimants should pay something’ was agreed by 84% of respondents and this became a principle embedded into our scheme.

A further consultation was undertaken in 2015 and there were no objections raised to this principle which ensures a degree of fairness as it applies across all groups who are of working age.

The scheme is devised to incentivise working age people to seek employment. For those who are in severe hardship or unable to increase their income, the Council manages a discretionary hardship fund to support them following a detailed review of the individual’s and household’s circumstances.

Does any adverse impact amount to unlawful discrimination?


Evidence: Any adverse impact can be mitigated through the use of the discretionary hardship fund.

What alternative actions could be taken to mitigate any adverse impact?

Continuation of the exceptional hardship fund to support those in financial need.

Action Plan

Impact Action required Lead Officer Timescale Comments
Financial pressure applied to low income families. Ensure all staff promote applications for the exceptional hardship fund to provide support to those in financial need. Lucy Wright Ongoing  
Financial pressure applied to low income families. Continuously monitor the impact of the changes together with take up of the exceptional hardship fund. Lucy Wright Monthly Monthly analysis of collection rates for CTRS caseload.
Financial pressure applied to low income families. Report the number of applications/awards made against the exceptional hardship fund. Lucy Wright Monthly Data to include expenditure to date to ensure adequate financial provision is made.

Action plan to be reviewed November 2019


Formal consultation

Public consultation held in 2012, 2015, 2016 and 2018 as detailed above.

Making a decision

The Council was required to replace council tax benefit with a local scheme with the requirement that pensioners are to be protected. It is inevitable that there will be negative equality impacts. As a result however this is mitigated by the creation and continued use of an exceptional hardship fund.

Continuous and ongoing monitoring of council tax collection rates with specific reference to CTRS claimants, numbers of reminders and summonses issued and number of exceptional hardship applications.

Publication of results

To be published following full Council decision in December 2018.

Signed: Lucy Wright

Agreed by Director of Service: Tracey Southall
Dated: 08/10/2020

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