How council tax benefit cuts have hit the poorest

More than a million low-income households are now required to pay the tax after the coalition cut support by 10 per cent last year.

While the baleful effects of the bedroom tax and the benefit cap have been well documented, far fewer have noticed the other large welfare cuts that was introduced last April: the abolition of Council Tax Benefit (CTB). Until that month, those households deemed too poor to meet the monthly charge received CTB to cover all or part of their bill. With 5.9 million recipients, it was claimed by more families than any other means-tested benefit or tax credit.

But last year the coalition scrapped the payment and transferred responsibility for the new regime from central government to local councils. At the same time, it cut the fund for support by 10 per cent. Councils in England were left with the choice of either maintaining current levels of support and imposing greater cuts elsewhere, or asking those who received a full or partial rebate to make a minimum payment. They were required to protect pensioner households, leaving the working-age poor to bear the burden of any increase. 

New research published today by the IFS shows what the results have been. Seventy per cent of English local authorities have introduced minimum council tax payments (forcing many poor households to pay the charge for the first time), with more deprived areas more likely to introduce them owing to a larger reduction in funding. Of the two million working-age households that could have claimed full relief under the previous system, 70 per cent (1.4 million) are liable to pay some council tax in 2013–14, with half liable for at least £85, a quarter liable for at least £170, and 10 per cent liable for at least £225. The new system led to an average increase of 30-40 per cent in the number of people seeking help from the Citizens Advice Bureau in relation to council tax debt between July and September 2013. Last October, Labour found that up to 500,000 vulnerable people had been summonsed to court for failing to pay the monthly charge. 

Labour-run local authorities were more likely than others to introduce minimum council tax payments, although the IFS notes that "this seems to be a reflection of the characteristics of LAs where Labour has a majority rather than a result of political preference". Once these factors were accounted for (most notably, the size of the funding cut and the number of low-income pensioner households), Conservative-majority councils were found to be more likely to introduce minimum payments: 14 per cent more likely than Labour councils and 25 per cent more likely than Lib Dem ones. 

Stuart Adam, a senior research economist at IFS and the co-author of the report, said: "Localising council tax support has, of course, led to considerable variation in the level of support available. Low-income working-age families are now likely to receive more help with their council tax if they live in a better-off area without too many low-income pensioners among their neighbours. Conversely working-age people living in poorer areas and in areas containing more low-income pensioners receive less help."

In response, Brandon Lewis, the local government minister, said: "Spending on council tax benefit doubled under Labour and is costing taxpayers £4bn a year - equivalent to almost £180 a year per household. Our reforms to localise council tax support now give councils stronger incentives to support local firms, cut fraud, promote local enterprise and get people into work. We are ending Labour's something for nothing culture and making work pay." But the steep rise in council tax is one reason why, for too many, work still isn't paying. 

Follow The Staggers on Twitter

Council-run housing in Lambeth on November 5, 2012 in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty Images
Show Hide image

I'm far from convinced by Cameron's plans for Syria

The Prime Minister has a plan for when the bombs drop. But what about after?

In the House of Commons today, the Prime Minister set out a powerful case for Britain to join air strikes against Isil in Syria.  Isil, he argued, poses a direct threat to Britain and its people, and Britain should not be in the business of “outsourcing our security to our allies”. And while he conceded that further airstrikes alone would not be sufficient to beat Isil, he made the case for an “Isil first” strategy – attacking Isil now, while continuing to do what we can diplomatically to help secure a lasting settlement for Syria in which Assad (eventually) plays no part.

I agreed with much of David Cameron’s analysis. And no-one should doubt either the murderous barbarism of Isil in the region, or the barbarism they foment and inspire in others across the world.  But at the end of his lengthy Q&A session with MPs, I remained unconvinced that UK involvement in airstrikes in Syria was the right option. Because the case for action has to be a case for action that has a chance of succeeding.  And David Cameron’s case contained neither a plan for winning the war, nor a plan for winning the peace.

The Prime Minister, along with military experts and analysts across the world, concedes that air strikes alone will not defeat Isil, and that (as in Iraq) ground forces are essential if we want to rid Syria of Isil. But what is the plan to assemble these ground forces so necessary for a successful mission?  David Cameron’s answer today was more a hope than a plan. He referred to “70,000 Syrian opposition fighters - principally the Free Syrian Army (FSA) – with whom we can co-ordinate attacks on Isil”.

But it is an illusion to think that these fighters can provide the ground forces needed to complement aerial bombardment of Isil.  Many commentators have begun to doubt whether the FSA continues to exist as a coherent operational entity over the past few months. Coralling the myriad rebel groups into a disciplined force capable of fighting and occupying Isil territory is a heroic ambition, not a plan. And previous efforts to mobilize the rebels against Isil have been utter failures. Last month the Americans abandoned a $500m programme to train and turn 5,400 rebel fighters into a disciplined force to fight Isil. They succeeded in training just 60 fighters. And there have been incidents of American-trained fighters giving some of their US-provided equipment to the Nusra Front, an affiliate of Al Qaeda.

Why has it proven so hard to co-opt rebel forces in the fight against Isil? Because most of the various rebel groups are fighting a war against Assad, not against Isil.  Syria’s civil war is gruesome and complex, but it is fundamentally a Civil War between Assad’s forces and a variety of opponents of Assad’s regime. It would be a mistake for Britain to base a case for military action against Isil on the hope that thousands of disparate rebel forces can be persuaded to change their enemy – especially when the evidence so far is that they won’t.

This is a plan for military action that, at present, looks highly unlikely to succeed.  But what of the plan for peace? David Cameron today argued for the separation of the immediate task at hand - to strike against Isil in Syria – from the longer-term ambition of achieving a settlement in Syria and removing Assad.  But for Isil to be beaten, the two cannot be separated. Because it is only by making progress in developing a credible and internationally-backed plan for a post-Assad Syria that we will persuade Syrian Sunnis that fighting Isil will not end up helping Assad win the Civil War.  If we want not only to rely on rebel Sunnis to provide ground troops against Isil, but also provide stable governance in Isil-occupied areas when the bombing stops, progress on a settlement to Syria’s Civil War is more not less urgent.  Without it, the reluctance of Syrian Sunnis to think that our fight is their fight will undermine the chances of military efforts to beat Isil and bring basic order to the regions they control. 

This points us towards doubling down on the progress that has already been made in Vienna: working with the USA, France, Syria’s neighbours and the Gulf states, as well as Russia and Iran. We need not just a combined approach to ending the conflict, but the prospect of a post-war Syria that offers a place for those whose cooperation we seek to defeat Isil. No doubt this will strike some as insufficient in the face of the horrors perpetrated by Isil. But I fear that if we want not just to take action against Isil but to defeat them and prevent their return, it offers a better chance of succeeding than David Cameron’s proposal today. 

Stewart Wood is a former Shadow Cabinet minister and adviser to Ed Miliband. He tweets as @StewartWood.