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‘Shake-up of tax is punishing poor’ in Bradford, says report
9:00am Tuesday 11th March 2014 in News
Poor people have been punished by a controversial shake-up of council tax in Bradford, MPs warn today.
The disabled, low-paid, carers and jobless have all been hit by new rules requiring them to pay 25 per cent of the levy, the powerful Public Accounts Committee (PAC) finds.
Its report warns the Government’s promise – that “vulnerable people” would not suffer from the axing of council tax benefit – has been broken.
And it calls on ministers to urgently draw up a “coherent set of guidelines” for town halls that threaten the stated objectives of the policy.
Margaret Hodge, the PAC’s Labour chairman, said: “Local authorities were also tasked with protecting vulnerable people such as poorer families, despite the fact that savings had to be made.
“However, 133 local authorities offered no protection to vulnerable groups, other than pensioners and war pensioners.”
Among those 133 councils is Bradford, which faced down protests last year to scrap council tax discounts of up to 100 per cent given to 34,000 working-age adults.
The rules came in after across-the-board council tax benefit was replaced by 230 different support schemes that town halls were told to draw up.
Labour-run Bradford said it had little choice, after the Government slashed funding by ten per cent. Its 25 per cent charge is designed to raise £4.5 million.
Now today’s report has found that: l the Government has failed to collect detailed information about local schemes and “their impacts on vulnerable groups”.
l the shake-up is failing to increase ‘work incentives’ in most areas – and has made it less worthwhile to go to work in some.
l councils have been short-changed because extra Whitehall grants fail to cover the increased cost of collecting council tax from poor people.
l Ministers have failed to set out how councils will adapt their support schemes when the new Universal Credit is introduced, by 2017.
Bradford Council leader Councillor David Green said last night: “The decision was taken having looked at the cost of extending the exemptions beyond the Government categories at a time when we were making a further £115m in cuts the cost of plugging the gap in Government funding for Council Tax benefit would have been £5m.”
Critics say inquiries to Citizens Advice Bureaux have rocketed where the poorest now pay some council tax and more people face legal action for non-payment.
But Brandon Lewis, the Local Government Minister, rejected the report’s findings – insisting the changes were “fixing the welfare system and reducing the deficit”.