Questions posed to full council meeting

Campaign members submitted some questions that were answered at the full council meeting on 28th January

We received the answers in the minutes of the meeting recently, we would appreciate any comments that you may have on the answers made by the city council.

Questions from citizens

Council Tax Support Scheme 

The following questions were asked by Mr Mark Giblin to the Deputy Leader:

(a) The City Council’s proposed Council Tax Scheme means that people who are already finding they have no money just before their next wage or benefit payment will be unable to pay Council Tax and will end up in debt causing poverty and distress. Is the Council intending to pursue debts when the cost of pursuing them is greater than the amount of the debt?
Councillor Chapman replied as follows:

First, let me correct the assumption in the question that the Scheme is somehow the City Council’s Scheme, the Scheme has been thrust upon us by central government and we are against this Scheme. It is badly thought out, it is unfair, and it will cause serious problems which the Council will have to manage.

We have, however, as a Council to provide a version of the Scheme where we have tried to bring as much fairness into the measure as possible when dealing with an intrinsically unfair measure. Nevertheless, we will have to collect the money, and we will be pursuing non-collection, we have no option. Council Tax payers are and will continue to be provided with a range of payment dates that suit their needs, taking into account different times that they receive their household incomes. This includes weekly, fortnightly, monthly and over a 10 to 12 month period.

Although the Council will actively pursue any outstanding Council Tax amount, it does recognise that more people with small amounts of money to pay may fall into debt. It is inevitable. First, unlike many councils, we have not reduced our Benefit Advice Service; indeed, we are looking to put more resources in. We have also reviewed our position for recovery of small debts with a view to reducing the risk of high court costs for these debts, while ensuring it can take appropriate action to support payment at the earliest possible stage. We are training up volunteers and working with the advice sector to ensure maximum support in the circumstances. We are also supporting Credit Unions to put people in their direction, instead of moving into the direction of loan sharks, which is another high risk. So we are doing what we can, but we will have to collect the money.

(b) Why is it that this Council finds it hard to find the funding to cover these welfare cuts yet the welsh government finds funding of £22 million to cover the shortfall in recipients benefits, this is over 3½ times what is touted as the shortfall in Nottingham.

Councillor Chapman replied as follows:

Well, the first answer is the Welsh government is a government and we are a council. Now, I could stop there, but it would be somewhat facetious.

The simple reason is the Welsh government has access to 56 times the settlement that Nottingham has. Its budget is £15.1 billion and, oh to have access to £15.1 billion. However, our net budget is £270 million, not billion, million. As a consequence, £22 million is only 0.15% of the Welsh budget. Nottingham, however, has found £3.2 million to offset the effect, which is 1.2% of our budget. So, in terms of budget size, we have made 8 times greater contribution than the Welsh government, and far more than similar councils, we are just not big enough to cover the whole amount. Moreover, £2.2 million of our contribution is ongoing and will continue, the £22 million from the Welsh government comes from reserves and there is doubt whether it will be able to continue to keep pumping reserves in year on year to cover the cost, so, at least there is some continuity in some of our funding.

(c) Will the new system for Council Tax and Housing Benefits be synchronised with the roll out of Universal Credit as and when the claimant is moved on to the benefit? Or will claimants have to be subjected to two bouts of changes in their welfare benefits?
Councillor Chapman replied as follows:

Well I wish I knew. It is unclear at this stage how or when Universal Credit will be implemented in Nottingham. The government intends Housing Benefit to be part of the Universal Credit system, which I believe is a mistake, administered by the Department for Works and Pensions (DWP). We will, where we are able to, work to ensure that any local schemes administered by the local authority, work in line with other government systems. We are, however, entirely dependent on what the DWP provide local authorities access to, and this is still, even at this stage, not clear.

Like many authorities, Nottingham does not understand why the government decided to pass responsibility for help with Council Tax to local authorities, rather than integrate it into Universal Credit.

As a consequence, local authorities have faced an unprecedented task in designing their own local Council Tax Support Schemes while facing a significant reduction in central government funding and preparing for launch in April 2013.

There will be a wide range of Council Tax Support Schemes that differ across local authorities, which may well be confusing for citizens. These local schemes will sit alongside a number of other benefit changes happening at the same time which is likely to add to confusion and hardship for citizens. So, not only are they going to get hit unfairly, they’re going to end up with a difficult system to manage which will make the situation even worse.

Choosing to not integrate Council Tax Support with Universal Credit may well undermine the overall policy intent of Universal Credit, especially in relation to simplification and improving incentives to work. And, in the longer term, separating the claims process for Council Tax Support and housing costs, which go to Universal Credit, may well cause further confusion for citizens. In other words, it is a mess. I personally do not think the system or the IT will be ready on time and I told the parliamentary Select Committee precisely that when I went down the other week.

Council Tax Support Scheme

The following question was asked by Mr Geraint Thomas to the Deputy Leader:

The Council refer to their new Council Tax Support Scheme as “sustainable”. Reducing the Council Tax Benefit of some of the poorest people in the City so that individuals and families will have even less money than the amount they need to live on will clearly lead to poverty, distress and hardship and will cause a greater demand on services that themselves face cuts to funding. Thinking about the long term effect on the people of Nottingham, this is not “sustainable”. Why does the City Council not use some of the Council’s non-earmarked allocated reserves of £9.6 million to avoid cutting the level of support for Council Tax Benefit recipients and use the forthcoming year to mobilise a campaign locally and nationally to demand a fully funded Council Tax Support Scheme?
Councillor Chapman replied as follows:

The simple answer is that we are, as a Council, using reserves to avoid cutting the level of support. We are also abolishing the discount on empty homes. Were it not for our use of reserves and the government subsidy it attracts, those that are receiving 100% rebate today, would be facing a 20% reduction this year. As it is, the reduction will be between 8 and 9%. Were it not for our abolition of the empty property discount, all non pensioners on benefits would be paying around 35%, not 20%, Council Tax. So we have done what we can with a diminishing council budget. The income from the empty property rate will continue to be applied and we cannot guarantee the contribution from reserve, other than for one year. We have the elderly to look after; we have children to cater for, we are hoping, however, by then that the government will be pressured into back tracking when it sees the consequences of its actions.

In terms of lobbying activity, we have clearly stated our opposition locally and nationally to the government’s decision to abolish Council Tax Benefit, and on 10 September this very Council carried a motion which deplored these measures. We have also lobbied MPs regularly. I have email and text exchanges with Liam Byrne, who is the Labour Shadow Minister, and hope that we have helped ensure the Labour Party’s opposition to these cuts, and it was a principled opposition to the cuts, in Parliament this month, and I am very proud of the Labour Party for that. We are currently doing a round of public consultation on the budget and on benefits showing our opposition. Every member of the Executive is participating in that process and every time we are talking to people about how unfair the benefits system is. We have put out press releases, we have set up 3 slots of TV coverage, the Politics Show last week was a result of a suggestion we made. We have met Lord Freud and explained the problems he was creating. This has not resulted in a change of direction, unsurprisingly, but we did get a scrap from it in the form of expanded emergency funding, because I think it pricked his conscience, and I also think he came out a bit more frightened than when he came in and the consequences of what he was doing.

Finally, because of our response to the legislation, we were one of the few councils invited to give evidence to the Select Committee on Benefits, where we made our opposition very clear. Nor have we finished. We will continue to bring forward cases of injustice, and there will be many, and inefficiency, and there will be many. We will continue to lobby both within our Party, and the government, and we will continue to alert public opinion about the unfairness of the legislation. But, what we will not do is anything outside the law, or refuse to implement what would be an illegal act, quite simply because we recognise that were we to do that it would be highly divisive and it would be counter productive, and we would end up by handing the management of this Council over to the government, the very government that is keen to impose these cuts, as harshly as it possibly can.