Agenda item

Local Council Tax Support Scheme and Consultation 2018/19

To consider a recommendation from the Cabinet meeting on 30 November 2017 to agree the Local Council Tax Support Scheme for 2018/19.


In introducing this item, the Chairman drew members’ attention to the letter of representation received from Saffron Walden Town Council.

Councillor Howell then presented the Cabinet recommendation to approve the 2018/19 Local Council Tax Support Scheme as set out in the report.  He said that the Council was required to consult on the scheme and vote annually even if no changes were planned.  The period of consultation had been extended and the Cabinet had received helpful feedback from the Scrutiny Committee on 30 November. 


The consultation outcome was an indication of strong public engagement and demonstrated how much people cared about the district. 


Paragraphs 4 and 5 of the report set out the basis of the scheme.  This provided for protection for pensioners on low income, disabled people and carers.  He drew Councillor Hargreaves’ attention to item g) stating that a discretionary subsidy grant had been provided to town and parish councils to neutralise the loss of the tax base caused by the way the LCTS operated.  The question of continued financial support for town and parish councils had been included in the survey because it was intended to change the policy.


He noted that, if approved, the scheme would be in its fifth consecutive year of maintaining the lowest liability cap in Essex at 12.5% and said the Council should be proud of that achievement.


The effect of the LCTS scheme had been to reduce the taxbase thus affecting council tax calculations.  The Government had put in place transitional funding arrangements in 2013/14 and the Council had decided to pass on the benefits of this funding to town and parish councils to ensure they were not disadvantaged by the taxbase adjustments.    


The transitional arrangements had now ended as the source of core funding through the Revenue Support Grant would no longer be available.  As a result of this change other Essex councils had decided to decrease or discontinue the parish subsidy grant.  The grant was reduced to 50% in 2016/17 to reflect changes in the RSG and it was proposed next year to reduce the subsidy payment to zero.


In commenting on the outcome of the public consultation, Councillor Howell said this was not a referendum and the Council was not required to act on the outcome but it was pleasing to note there was broad support for maintaining the 12.5% contribution rate. 


Thaxted Parish Council and now Saffron Walden Town Council had written objecting to the withdrawal of the discretionary grant.  The letter from Thaxted Parish Council largely reiterated objections made previously and when the grant had been reduced by 50% last year.


The withdrawal of RSG meant there was no additional funding to meet the cost of the LCTS scheme so that the Council would now bear the full burden including the payment of any grant funding made to town and parish councils.  With this in mind, the recommendation in the report set out the scheme most appropriate for Uttlesford based on what the Council could afford, while continuing to protect the most vulnerable.  It was proposed that the discretionary payment to town and parish councils should be withdrawn.


He proposed the recommendation.


Councillor Chambers seconded the motion.  He said he agreed with Councillor Howell’s comments as the Council was doing what it could to support the most vulnerable.               


Councillor Dean summarised the views of the Scrutiny Committee.  They had concluded the consultation should be simplified and this might have some impact on the cost of the exercise.  In commenting on the withdrawal of the subsidy grant to parishes, he said there was no logical reason why the loss of the taxbase could not be replaced by raising extra revenue through the parish precept. 


Councillor Lodge proposed an amendment to part iii of the motion.  The proposed amendment would replace the word “withdrawn” with the words “maintained at current 2017/18 levels”.  The full amendment would then read:

“The discretionary subsidy grant for town and parish councils is maintained at current 2017/18 levels.”            


Councillor Lodge read part of the letter from Saffron Walden Town Council quoting comments made by Sajid Javid MP, Secretary of State for Business, Innovation and Skills, in support of his amendment.  He said the Secretary of State’s comments broadly stated that principal authorities should not be using parish precepts as a means of avoiding their own cap on council tax increases.  Uttlesford was heading towards a £1.5m surplus and should not be putting punitive increases at town and parish council level.  The Council was well able to afford to maintain the subsidy grant and should do so.


Councillor Gerard seconded the amendment.


Councillor Dean spoke against the amendment.  He said the Minister’s speech had been misinterpreted.  The Council was not delegating responsibilities to towns and parishes in this case.


Councillor Howell made clear he was not prepared to support the amendment.  The Council had adopted the appropriate structure to support local communities where the need was greatest.  It was more important to retain the 12.5% contribution cap than to maintain the Town Council’s taxbase.  The Town Council had received £48k in grants from Uttlesford last year and there were additional grants allocated for local use to Saffron Walden ward councillors.  He had been very clear to his own parish council about the impact on the local taxbase but town and parish councils all had the opportunity to adjust their budgets accordingly.  Councillor Dean had been entirely correct to say that the Secretary of State’s speech had been referring to devolved responsibilities.  The Council was not withholding funds from towns and parishes as the additional funding from Government had ceased some time ago.  The Council’s LCTS policy was appropriate and would stand the test of time.


Councillor Lodge asked for a recorded vote on the amendment.


The Chairman put the amendment to the vote and the voting was as follows:


For the amendment: Councillors Asker, Fairhurst, Gerard, Hargreaves, LeCount, Lees, Lodge and Morris 


Against the amendment: Councillors Artus, G Barker, S Barker, Chambers, Davey, Davies, Dean, Farthing, Felton, J Freeman, Goddard, Gordon, Harris, Hicks, Howell, Jones, Lemon, Loughlin, Mills, Oliver, Ranger, Redfern, Rolfe, Sell and Wells


The amendment was lost by 25 votes against to 8 votes in favour.


Following further comments from Councillor Howell, the substantive motion was then put to the meeting and carried.


RESOLVED to approve the Local Council Tax Support Scheme for 2018/19 as follows:

i)             The 2018/19 LCTS scheme is set on the same basis as in 2017/18 therefore freezing the contribution rate for the fifth consecutive year.

ii)            The Council continues to protect vulnerable and disabled residents and carers on a low income.

iii)           The discretionary subsidy grant for town and parish councils is withdrawn.



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