Select Committee on Communities and Local Government Committee Eighth Report

Conclusions and recommendations

1.  Public perceptions of the legitimacy of the council tax are likely to be further undermined if the mechanism designed to alleviate the financial burden it places on low-income households is not effective. Council tax benefit eligibility, entitlement and take-up must be improved. (Paragraph 10)

2.  Given the Government's commitment to eradicating child poverty it is difficult to see how it can justify the maintenance of council tax benefit rules that even on its own estimates leave some 600,000 children living in poverty whose families are still liable to pay full council tax. (Paragraph 14)

3.  The council tax benefit taper, and its interaction with other parts of the tax and benefit system, can act as a disincentive to work. We recommend that the Government address this issue with some urgency and recognise the detrimental effects of the council tax benefit taper in its work on welfare reform. (Paragraph 17)

4.  We recommend that the Government includes examination of the consequences of aligning council tax benefit eligibility thresholds with thresholds used in other parts of the tax and benefit system in its research programme. (Paragraph 19)

5.  We urge the Government to consider sympathetically proposals to raise, and ultimately abolish the use of, an upper savings limit in determining eligibility for council tax benefit, not just for pensioners, but for all. (Paragraph 29)

6.  The Government should review age-related anomalies in council tax benefit with a view to removing them as part of its work to simplify the benefits system for claimants. (Paragraph 35)

7.  We recommend an immediate change to describe all reductions in council tax liability as the rebates that they actually are. (Paragraph 50)

8.  We recommend that the Pension Service acts as a portal to council tax benefit for all telephone customers calling to claim pension credit. (Paragraph 56)

9.  We recommend that the Government accelerate efforts to promote inter-agency data-sharing, particularly between the Pension Service, HMRC and local authorities, as a means of increasing council tax benefit take up. Supporting research should include an examination of the impact of data protection legislation on the potential for greater data-sharing and options for maintaining privacy for individuals who do not agree to their data being shared. (Paragraph 61)

10.  The Government should publish the findings of the Pension Service solution project on the automated payment of council tax benefit. We recommend that the Government investigates further the feasibility of introducing automatic assessment and billing, starting with those groups for which it could most easily be achieved. Its research should extend to an analysis of the risks of fraud. (Paragraph 65)

11.  We recommend that the Government encompasses in any general PSA target related to benefits and pensioner poverty promotion of council tax benefit take-up. (Paragraph 67)

12.  Local authorities are best-placed to lead on local measures to increase council benefit take up. (Paragraph 69)

13.  The current performance standards for local authorities should be revised to increase the focus on raising council tax benefit take up not just administrative efficiency. (Paragraph 70)

14.  We recommend that the Government gathers the information required to provide estimates of the numbers entitled to but not claiming council tax benefit by local authority area. (Paragraph 72)

15.  We find no justification for financial incentives for local authorities to increase council tax benefit take up. (Paragraph 74)

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Prepared 6 August 2007