Publications

Council Tax

The impacts of Council Tax Support reduction on arrears, collection rates and court and administration costs

  • Published 25th Sep 2014
  • Authors: Sabrina Bushe, , Hannah Aldridge,
  • Category: Council Tax

In April 2013, Council Tax Benefit (CTB) was abolished and replaced by Council Tax Support (CTS). In England, 326 local authorities had to devise their own local CTS schemes, but with 10 per cent less funding. This summary looks at the impact of that change on council tax arrears, collection rates and court and administration costs.

Key findings

  • In 2013/14, the majority of local authorities in England saw council tax arrears and court and administration costs increase and collection rates fall. These changes were more pronounced in areas that reduced Council Tax Support entitlement.
  • The main entitlement change introduced by councils in April 2013 was the requirement for all working-age adults to pay at least some council tax regardless of income. Councils that introduced this ‘minimum payment’ were more likely to see arrears and court and administration costs increase and collection rates decrease.
  • Areas with a higher minimum payment tended to see greater increases in arrears than areas with lower minimum payments. For instance, arrears increased by at least a quarter in 84 per cent of councils with a high minimum payment, compared to 32 per cent of councils with a low minimum payment.
  • Increases in arrears and court and administration costs were more common in areas where there were larger cuts to support. For instance, court and admin costs increased in 43 per cent of councils where the cut was less than £1 per week, but increased amongst 65 per cent councils cutting support by £2 per week or more.

About this report
This report was funded by the Joseph Rowntree Foundation (JRF) and written by Sabrina Bushe and Hannah Aldridge of the New Policy Institute. The facts presented and views expressed in this report are those of the authors and not necessarily those of JRF.