Residents invited to take part in consultation on proposed changes to Council Tax Reduction scheme
COUNTY Durham residents are being invited to give their views on proposed changes to a council tax reduction scheme (CTR) for working age people.
The scheme, which has been in place since 2013, offers financial help to pay council tax for anyone on a low income, with Durham County Council being one of the few local authorities to offer residents uncapped support, with up to 100 per cent off their bill. Currently, the scheme helps more than 32,000 working age households in County Durham and costs £41.3 million annually.
However, national welfare reforms have significantly changed the benefits system and have resulted in the scheme becoming increasingly complex, costly to administer and confusing for claimants. Changes include most working age residents having moved onto Universal Credit (UC). Currently, 84 per cent of the county’s working age CTR claimants are on UC, and this number is expected to rise to 96 per cent by 2026, which equates to around 30,700 households.
After a rise during the Covid-19 pandemic, the number of claimants is now at its lowest level since 2013. Despite fewer people claiming, the cost of the scheme has increased due to council tax bills rising and increased administration.
Furthermore, the council, like most others, is under huge financial pressure and is examining everything it offers to find ways to reduce costs. In February, a report identified that the authority had been required to deliver £289 million of savings since 2010 in order to balance its budget, and that a further £45 million needed to be saved by 2028/29.
Cllr Nicola Lyons, Durham County Council’s Cabinet member for stronger communities and belonging, said: “We offer one of the most generous council tax support schemes in the country in terms of working age households, and it is just one of the many ways we help vulnerable and low-income households.
“These changes would ensure we are able to continue providing this much-needed support, while also addressing the increasing financial pressure local councils are under.
“It’s important we find out what residents and people think before any decisions are made, so we’re inviting everyone to give their views in our consultation process. Even if you’re not in receipt of the reduction, we want to know what you think of the changes to the scheme.”
Currently, the system works out an appropriate amount of money, based on national benefit rates, for each person or family for their living expenses. It then looks at how much money the household gets each week. If the household’s income is less than their appropriate amount, they get full help with their council tax. If their income is more than the amount they need, they do not get full help. Instead, 20 per cent of the extra money they have is taken off their tax bill.
Within this system, a person on UC gets, on average, 11 different council tax bills a year, as a new bill must be issued every time their circumstances change. This leads to frequent alterations to their CTR award, making it difficult to budget and problems with direct debits.
This results in higher administration costs due to higher printing and postage numbers, and more staff time to manage the increased volume of changes received each year. Proposed changes to the system hope to address these issues and would see a new income banded system that would start on Wednesday 1 April 2026, for the new council tax year. These changes would only affect working age people.
There are four options within the proposed new system that people are invited to share their views on:
- 1a: Income banded CTR scheme.
- 1b: Income banded CTR scheme with a minimum of a 10 per cent contribution to the council tax bill.
- 1c: Income banded CTR scheme and a minimum of a 20 per cent contribution to the tax bill.
- 1d: Income banded CTR scheme and a minimum of a 25 per cent contribution to the tax bill.
Under each of these options, the council would remove the current complex calculations and replace them with income bands, meaning that minor changes to a claimant’s circumstances would not impact on their CTR entitlement. This would simplify the process, avoid multiple bills being issued and provide an opportunity to make savings in the administration of the scheme.
Three of the options also include a proposal to introduce a minimum council tax contribution for all working age households, this would help the local authority meet the huge financial pressures it is facing and result in all working age households having a financial stake in the council’s services. The council will also consider circumstances where minimum contributions, if applied, may not be suitable, such as those diagnosed with a terminal illness and how wider discretionary support can be provided in these instances.
Anyone who would like to have a say on the proposed changes can complete the online survey at www.letstalkcountydurham.co.uk. Alternatively, they can complete a paper survey and return it to any library. These can also be scanned and sent to
Meanwhile, interested parties can attend an online event on Tuesday 5 August between 6 and 7pm, or Monday 14 August between 11am and 12pm. To book a place go to www.letstalkcountydurham.co.uk or email using the same address as above.
The consultation process will run from 18 July to 26 September.
