Council tax support to be reduced from April to save nearly £4m a year

By Local Democracy Reporter Daniel Mumby

Support for Frome residents struggling to pay their council tax bills will be cut from April to save Somerset Council nearly £4m a year.

Somerset Council currently operates a council tax reduction scheme, providing discounts for single people, couples and families.

The council currently spends around £28m on these discounts, of which more than £15m funds discounts to people of working age.

In light of its ongoing financial pressures, the council launched a consultation in July on making changes to the scheme, reducing the amount of discount available in order to save millions of pounds every year.

The full council has now approved changes to the scheme, which will come into effect in April once the council has set its annual budget for the coming year.

A total of 31,745 council tax payers in Somerset currently receive some form of council tax reduction, with the cost of delivering this being split between Somerset Council, Avon and Somerset Constabulary, and Devon and Somerset Fire and Rescue Service.

To save nearly £3.9m a year from April, the council will be making four key changes to the council tax support it provides:

Reducing support for working-age applicants (£2.3m): This form of relief is based on your weekly income (i.e. the more you earn, the less discount you receive). The poorest in the county will still receive a 100 per cent discount, but this will then be tapered to 50 per cent, 25 per cent and ten per cent depending on your weekly earnings.

Introducing a standard non-dependant deduction (£1.5m): the council will introduce a flat rate deduction of £10 per week for every non-dependant living with the ratepayer (such as a son or daughter aged 18 or over).

Restricting support to Band D Council Tax levels (£86,000): the council currently provides relief on all eight bands of property, with Band A being the lowest and Band H being the highest. Under these proposals, relief would only be available to those living in Bands A to D – meaning people living in larger or more expensive houses would pay more council tax.

Restricting the backdating of council tax reduction (TBC): currently, if you apply for a council tax reduction, the council can backdate the award by up to 12 months depending on people’s individual circumstances. Under the new scheme, any backdating would be fixed at three months.

Other eligibility criteria for council tax relief will remain unchanged, including:

No relief for those with more than £6,000 in capital

War pensioners’ pension levels will be disregarded

The exceptional hardship scheme will remain in place

The first £30 per week for disabled people will continue to be disregarded

The council estimates that these changes will affect 69 per cent of working age people who currently claim some kind of council tax support – with each claimant on average having to pay an extra £415.18 a year in council tax.

Deputy leader Liz Leyshon told the full council in Bridgwater on Wednesday 18th December, that urgent changes to the funding of local government were needed to prevent further burdens being placed on working people.

Liz Leyshon (who represents the Street division) said, “We can recognise this is a situation that no council wants to find themselves in and how council tax is both an unfair and unsatisfactory way to fund local care services.

“The local government financial settlements have just come out and our finance team is working very hard in the back office to realise the implications for Somerset.

“A one per cent increase of council tax for Somerset means an income of approximately £3.6m. In some places, it’s more like £8m or more.”

Councils are currently only able to raise council tax by a maximum of 2.99 per cent per year, plus an extra two per cent which is ring-fenced for adult social care.

Council leader Bill Revans said he would be writing to the Ministry for Housing, Communities and Local Government (MHCLG) to make the case for an increase above this limit without holding a referendum, in light of the county’s low council tax base.

He also pledged that residents’ voices would be fairly heard within the council’s budget consultation, which was officially launched on Friday 13th December.

Cllr Revans (who represents the North Petherton division) said, “We do not know the impact of the government’s financial settlement.

“I know there has been substantial lobbying across all councils of all flavours around the increase in national insurance, which will impact our care providers and impact on us greatly.

“We try and ask budget questions that are fair to elucidate answers that genuinely reflect what the people of Somerset think. We’re not trying to game the system.

“An increase above the council tax cap may be needed, but at the moment that’s just an exploration.”

The council’s budget consultation gives residents and businesses the opportunity to rank the services they most want Somerset Council to prioritise over the next 12 months.

The council is currently predicting a budget gap of £88.8m for 2025/26 – though this falls to £53.8m when its staff restructuring programme (also known as the transformation programme) is taken into account.

Speaking on Friday 13th December, Cllr Revans said, “We have been very open about our financial emergency due to soaring costs and demands on services like adults and children’s social care.

“We have worked hard to avoid a Section 114 notice [declaring effective bankruptcy] and have had to consider many difficult and heart-breaking decisions.

“But we are also a listening council, and last year we took on board feedback from our budget consultation to remove some proposals and protect others by working in partnership with our fantastic city, town and parish councils.

“We will continue to use our voice to stand up for Somerset. Please use your voice to let us know what matters to you.”

The full council will meet to set the budget for 2025/26 in Bridgwater on 19th February.

Pictured: Cllr Bill Revans at the meeting in December