The Revenue and Benefits Programme Manager introduced the report.  He said that the Council Tax Reduction Scheme (CTRS) used to be fully funded by Government but from April 2019 the Council would have to meet the full cost to the Council of £1.6m per year.  The caseload had been reducing slightly and although it could increase if the economic conditions worsened the cost of the scheme was thought to be fairly static.   However, the cost pressure would increase in proportion to the reduction in Formula Grant from £1m in 2016/17 to £1.6m in 2019/20.  This cost had already been budgeted for in the Medium Term Financial Plan.  The overall cost of the scheme was about £10m but the County bore the majority of this cost and the Police bore about one-sixth of the cost. 

The Revenue and Benefits Programme Manager explained that the CTRS provided full Council Tax support to people on low incomes at a time when many other benefits were being reduced.  Further benefit changes had yet to take effect including the lowering of the Benefit Cap, reductions to Universal Credit and additional Tax Credits and Housing Benefit restrictions. 

The Panel heard that the assessment process for CTRS mirrored that for Housing Benefit.  Given that most applicants claimed both benefits, it made sense to combine the administration of the two schemes.  A project group had been set up to develop proposals for a new scheme once Universal Credit replaces Housing Benefit.  This will provide an opportunity to achieve some administrative savings from 2018.

The Panel questioned whether there was an obligation on the other precepting authorities to accept the scheme, which affected the level of their Council Tax income.  The Revenue and Benefits Programme Manager explained that control lay with the collecting authorities but that in developing the scheme, the Council had worked closely with other Oxfordshire authorities in taking a county-wide approach.   Some neighbouring authorities had subsequently moved away from this approach by introducing minimum payments.  There was no requirement for authorities to report the impacts of CTRS schemes, for example on Council Tax collection rates, so information available for benchmarking was patchy.  However, if the level of support was reduced then the overall collection rate would be affected and administration costs associated with the scheme would increase. 

In response to a question, the Panel heard that CTRS was a separate scheme from Council Tax Discounts and Exemptions but that the Council had used the proceeds of higher Council Tax charges on long-term empty properties to partially off-set the cost of CTRS.  The Revenue and Benefits Service Manager explained that the Council was required to have a separate discretionary discount scheme but that no discretionary discounts had yet been granted because, unlike many other authorities, the Council offered a full reduction under the CTRS scheme.  The Council would look at any applications on their merits but would not use public money to fund discretionary discounts lightly.  The Panel also received assurances that officers looked at applicants circumstances in the round and could consider whether they might be eligible for things like Discretionary Housing Payments.

The Panel noted that CEB would be asked in October to renew the scheme for next year with no changes.  The Panel agreed to convey the following points and observations to the Board:

·         That the Panel supports the proposal to keep the CTRS unchanged for next year and the work being done to link CTRS to Universal Credit in future years.

·         That the cost to the Council of maintaining the CTRS with a 100% Council Tax reduction for both working age and pensionable age recipients is increasing significantly in proportion to the reduction in Formula Grant, from £11.8k in 2013/14 to £1.6m in 2019.

·         That this cost has already been built into the Council’s Medium Term Financial Plan.

·         That the CTRS also significantly impacts the Council Tax income of the County Council and Thames Valley Police.

·         That the CTRS reduces the overall Council Tax take and affects the band D multiplier.