SUPPLEMENTARY WRITTEN
SUBMISSION FROM
THE
DEPARTMENT FOR
COMMUNITIES AND
LOCAL GOVERNMENT
DCLG SELECT COMMITTEE:
WELFARE REFORM
In the Select Committee Evidence session on welfare
reform on Wednesday 6 July, Mr Rotheram asked if it was correct
that under the proposed localisation of Council Tax Benefit, councils
in deprived areas stood to be four times off worse off than other
councils.
I was not able to respond in detail at the time,
as I did not have the analysis to hand. My officials have now
looked at the analysis set out in the New Policy Institute Report
of October 2010 into the localisation of Council Tax Benefit,
on which I understand Mr Rotheram's question was based.
I would like to reassure the Committee that the consultation
that we will be issuing shortly will be looking at all aspects
of localisation. This will include the principles for distributing
the grant which local authorities will be able to use to fund
support for council tax in their area. The analysis assumes a
straight 10% cut in grant across all authorities. In practice,
how this grant is distributed, and what factors the distribution
takes account of, will determine the level of saving that individual
authorities will need to find. We will actively seek the views
of local authorities and others on what factors they believe should
be taken into consideration.
By giving local authorities a stake in providing
support for council tax, this reform is intended to strengthen
the incentive for local authorities to support residents back
into employment and so reduce demand for support and lessen the
effect of the funding reduction. Localisation also reintroduces
the link between council tax levels and the costs of providing
support, reinforcing local financial accountability.
July 2011
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