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Making welfare work locally: council tax support in Cambridge

15 Medi 2014

Using local housing market conditions to raise revenue and maintain protections

We knew that people were being affected by other benefit changes and that everyone has less money in their pockets. Within Cambridge City Council, there was cross-party support for keeping the same level of support, if we could meet the shortfall in funding. When we realised that we could do this by making changes to council tax discounts and exemptions, this was the path that was taken.

Alison Cole, Head of Revenues and Benefits, Cambridge City Council

Summary of scheme

  • £750,000 less funding after council tax benefit abolished
  • No minimum contribution to council tax
  • Reduced backdating from six months to one month and in some circumstances increased non-dependent deductions and removed second adult rebate. Otherwise the scheme provides the same level as support as was provided by council tax benefit
  • Technical changes to council tax, including discounts, exemptions and premiums, raise sufficient revenue to cover CTS scheme
  • 1,994 households affected by changes to council tax discounts and exemptions

Why Cambridge’s work stood out

Following detailed modelling work Cambridge City Council knew that its extremely mobile population and high turnover of rental property provided an opportunity to raise sufficient revenue in respect of property that was left unoccupied for more than one month between tenancies. It was estimated that overall the additional revenue would be sufficient to meet the costs of continuing to provide full council tax support.

This has enabled them to protect those on low incomes from a reduction to their council tax support, and at the same time incentivising the return of long term empty properties to use.

Project strengths

  • Using local housing trends and benefit data to inform design
    Cambridge has a relatively buoyant housing market with high rents and a lot of short term tenancies. Changes to local housing allowance rates and the introduction of the under occupancy penalty meant that around 1,800 people had a housing benefit shortfall. The council therefore decided that raising revenue through changes to council tax was both fairer and more achievable than passing the reduction in funding onto council tax support recipients.
  • Use of ‘One Council’ approach to ensure cross departmental co-operation and understanding
    Cambridge City Council set up a working group to ensure that the impacts of welfare reform are considered across the whole organisation. This involves staff from City Homes (the council’s landlord services) as well as homelessness, customer services, corporate services and community development sections. City Homes has a trusting relationship with the Revenues and Benefits section and despite an increase in its council tax liability as a landlord, it is supportive of the changes.
  • Above national average collections figures and long term empty properties returning to use
    Cambridge City Council contacted all 1,994 affected council tax payers about the changes and how they would be affected. The rate of collection for empty properties is the same as for all properties. Overall there has been a 0.1 per cent reduction in collection rates from 2012/13 to 2013/14, compared to a national average of 0.4 per cent. The number of properties that have been empty for two years or more has reduced from 113 to around 70.

Cambridge City Council indepth showcase [ 160 kb]

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