From the Revd Paul Nicolson
Sir, - Council tax as we know
it is being abolished, but councils will reinvent their
own schemes as required by clause 9 (1) 13A (2) of the Local
Government Finance Bill, which is due to reach its final stages in
the House of Lords in October.
Each council must make a scheme
specifying the reductions that they are to apply, having decided
which constituents they consider to be in financial need. They have
absolute discretion to define financial need, but their room for
manoeuvre is curtailed by the coalition. Ten per cent, or £500,000,
has been cut from the central-government council-tax-benefit grant;
on top of the 28 per cent already cut from the central grant; it
was let slip by Earl Atlee for the coalition that the ten per cent
is to help fund the railways (Hansard, 16 July 2012).
Councillors of Haringey are being told
that "the cut in the national grant is based on the projected
declining national demand for council-tax benefit, when Haringey
has seen claimant numbers rise by 11 per cent over the past three
years. This alone makes the cut of ten per cent more like 16-18 per
cent. When you add that someone will need to pick up the bill for
'protected' pensioners (some 30 per cent of claimants in the
borough), we are looking at a total cut of around 22 per cent for
those affected. This potential cut to council-tax benefit will be
dwarfed by the future impact of universal credit."
The equalisation procedure is
abolished. This enabled higher central grants to be made to
councils with a high population of impoverished constituents and
therefore a higher amount of council-tax payments. The total amount
of council tax currently collected by the councils may not be
increased without a local referendum. Who is going to vote for a
tax increase? If councils do not, or cannot, continue to pay
100-per-cent benefit to people who receive it now, then we have
another poll tax, which taxed unemployment benefits with 20 per
cent of the tax for that household.
The probable consequences include: a
patchwork quilt of definitions of financial need, as councils make
separate decisions, and the burden of the new council taxes fall on
the working poor
and low-paid, because of the
regressive nature of the bands. It will undo the lowering of the
income tax threshold for the low paid, and probably tax the
universal credit, so spoiling the Department for Work and
Pensions's efforts to make work pay. The increasing number of
unemployed will inevitably increase the number of council-tax
claimants, so requiring taxpayers to pay more or the benefit to be
cut further.
Financial need is created by the
cumulative effect of the move of benefit uprating from retail price
index to the slower-rising consumer price index, sanctions, civil
penalties, housing-benefit caps, council-tax cuts, and the
universal credit caps on the poorest citizens of Britain, which has
not been calculated by the coalition.
No account has been taken of the low
level of the proposed universal credit for single adults at £71 a
week or £56.25, already hit by rising transport, food, and fuel
costs. Discretionary housing payments designed to help households
forced into debt by housing-benefit caps, which have been used to
pay off council-tax arrears, will not be allowed to pay off
council-tax arrears in the future.
Councils with reduced staff will take
short cuts on enforcement of an increasing number of arrears. Bulk
applications for liability orders, thousands at a time, will be
made to the magistrates' courts, allowing the councils to dispatch
bailiffs to thousands of households they know nothing about. This
will hit pregnant women, the disabled, the bereaved, and the
mentally and physically ill on low incomes with court, council, and
bailiffs' costs of up to £600 on top of the inevitable council-tax
arrears.
The enforcement procedures against
unmanageable debt will increase both mental and physical illness
and the costs to the health service. Food banks will increase in
number, as will the number of families with hungry children and
homeless single adults who need them; food banks can supply only
three days' food.
Please sign our e-petition on http://epetitions.direct.gov.uk/petitions/25438.
Stop the housing benefit and universal credit caps.
PAUL NICOLSON
Chair, Zacchaeus 2000 Trust, 34 Grosvenor Gardens, London SW1W
0DH