Thousands face cuts to council tax support

Leicester City Council is proposing changes to the way council tax support for low-income households is worked out

Thousands of people in Leicester could be worse off after the local authority revealed plans to change the way council tax support for low-income families is calculated.

Leicester City Council said its proposed changes would save £2.8m per year.

Under the plans, a new weekly income banding scheme would be brought in to determine the level of council tax support people receive, and bring the scheme in line with the government's Universal Credit.

A consultation is now under way, and according to the council, the plans could make 13,500 city claimants worse off by £325 a year.

The council said financial support could be removed completely from a further 1,900.

But it added the proposed scheme would simplify the process of awarding council tax support - and lead to fewer changes in the amount of tax people have to pay - due to "even slight changes" in their income.

Currently, the city council said it processed more than 130,000 changes a year – an average of seven changes for each of the households that receive council tax support.

In the worst cases, the authority said this could result in people getting unexpected bills for unpaid council tax.

The new income banding scheme, the council says, will be "sufficiently broad" to avoid constant changes in support.

The city council will make a final decision on the scheme in January

Deputy city mayor Sarah Russell said the move had been triggered by the "severe financial pressure" the council faced.

The council said it spent £14.9m a year on council tax support for working age households and that these changes would save it money while altering the amount claimants received.

And, under the proposals, the council added 4,200 city households would get, on average, £249.60 more a year.

No changes are proposed for claimants of pension age, in which different rules are set by government.

'Could be a struggle'

Russell said: "These proposals are intended to make our council tax support scheme simpler and fairer and increase support for those households who need it the most.

"At the same time, we need to respond to the severe financial pressures placed on the council by the previous government.

"I understand that for some of the people who might have to pay more towards their council tax, this could be a struggle."

She said a £500,000 pot set aside as discretionary council tax support would be increased to £750,000 for two years.

The consultation ends on 10 November and a final decision will be taken in January.