Will York rid itself of Pickles’ poll tax?

How many people in York have been hit in the pocket by the changes? Photograph © Peter Czerwinski on Wikipedia
20 Nov 2015 @ 12.10 pm
| Opinion

Richard Bridge urges everyone to take part in a consultation to ensure York’s poorest aren’t hit hardest by a change in the tax rules

Dubbed Pickles’ poll tax, the localisation of council tax support was an ingenious piece of legislation that provided a hospital pass to local authorities.

Brought in by then Local Government Secretary Eric Pickles, it required councils to allocate funds towards its poorest working-age residents with a greatly reduced budget (interesting to note: pensioners were exempt, secondly: note how some groups of poor people are deemed more deserving than others).

Whilst not receiving the media recognition of the bedroom tax, its insidious effect on vastly more people has been equally pervasive.

Well, good news. After two years of campaigning across the city, York is now undergoing a consultation on its council tax support scheme which was placed in the most regressive category by Joseph Rowntree Foundation’s research (worst for claimant but best for council!).

I appreciate a council tax support scheme consultation hardly sets the pulses racing but if you want to skip the rest of this piece, please still do contribute to the consultation which you will find here.

Based on a false premise

I wrote more extensively about this for YorkMix last year. Moreover Advice York (the collaboration of advice agencies in York) have published extensive research on the impact through its two publications Pushed into Poverty: the real cost of council tax support and more recently its follow-up Every Penny Counts.

I am not intending to discuss here the toxic impact that this scheme has had on York’s most vulnerable residents – those previous publications make it clear that every penny really does count when cutting support from the poorest in the city.

Former minister Eric Pickles, who introduced the change. Photograph © Communities Department on Wikipedia
Former minister Eric Pickles, who introduced the change. Photograph © Communities Department on Wikipedia

If – as I hope – you contribute to the consultation, you will be asked how much discount you believe claimants are due, and moreover to explain how any additional support will be funded.

The leader of the councillor asked me that same question in a recent letter to the York Press. When public funds are so short, that question appears more than reasonable.

It is however based on a false premise. Not only that austerity is an inevitability rather than a political choice, but moreover that funds are already available that could fund 100% of the scheme, which City of York Council state would cost £1.15m.

Let me illustrate as follows:

  • The JRF research which placed York in the worst for claimant, best for council category showed that City of York council tax support scheme recouped via from its poorest residents £683,000 more than the central government cut (it raised £1.72m whilst the central government grant was £1.037m).

    As the table shows, York recouped 166% of its cut. It effectively made a profit from its poorest residents!

    Only Oldham, Peterborough, Rochdale and Wakefield fare worse in the whole country.

A list of the authorities categorised as ‘Best for Council, Worst for Claimant’
A list of the authorities categorised as ‘Best for Council, Worst for Claimant’
  • Up until 2012, City of York Council gave landlords a 100% exemption on empty properties. On average, this meant it was giving landlords a discount of £1,115,595 per annum.

    That discount was removed in 2013 and 2014, meaning that money is now available for the poorest residents in the city. You may note that this is exactly the same figure as the money that the council would need to fund 100% of the scheme.

That shows the question is based on a false premise but in case the council need further ideas, here are a few …

  • The Council still provides a 50% council tax discount to property owners who are undergoing structural work. If that was ended (as Leeds City Council have done), it would raise a further £80,000. If we use the ‘deserving’’ categorisation that is so beloved of Conservative ideology, are we seriously saying landlords are more deserving than a person unable to work who receives £73 per week (or £56 if they are under 25)?
  • The York Financial Assistance scheme (the successor to crisis loans and community care grants) which is used to provide emergency and community assistance has had low take-up due to the poor marketing of the scheme. Whilst this discretionary scheme is essential, at least £200,000 per annum could be diverted to council tax support.
  • Consider the efficacy of all financial inclusion measures

‘Astonishing’ recommendation

At this point, I should point out that Advice York recommend in their latest report that the discount provided to residents should be 17%.

That was based on the perception that this level of council tax support would mean that arrears could be recouped from deductions from benefits without the claimant getting further into arrears.

Having read the robustness of their research and the deleterious impacts of the scheme, I find it astonishing that the agencies that form the partnership are really saying that when people are in receipt of £73 (or £56 if under 25), a 17% payment is appropriate.

Especially when the cumulative effect of other welfare reforms (for instance the bedroom tax, lack of uprating of tax credits, the benefit cap) are taken into account not to say what is on the horizon.

Perhaps the financially circular relationship between City of York and Advice York is responsible for this relatively weak recommendation.

In any case, I hope that the points above illustrate that there is undoubtedly money already available which means York’s poorest residents need not pay towards their council tax.

So, please do contribute to the consultation – after all, this administration pride themselves on being a ‘listening’ council’ – and don’t succumb to the narrative of austerity.   Surely those with the biggest pockets should shoulder the biggest burden (the reason why I think landlords should contribute more in this case).

Ask yourself this

But if you disagree on that point, just ask yourself one question.

Olivia told Advice York:

We don’t have any heating on during winter because I can’t afford to have heat. It’s not very nice being in a cold house I can tell you now you know.

Should residents in York who have a garden have a free green bin collection when Olivia won’t be able to afford to heat her house this winter?

Thankfully, it isn’t a choice between the two. The money is already there – it is just whether the council coalition use it for the poorest residents or for other projects they prefer?