September 25th, 2016

Rent arrears increase

Rent arrears increase Rent arrears increase
Updated: 9:36 am, May 07, 2015

ALMOST half of people in council housing affected by changes to council tax benefit have seen their rent arrears increase.

But officers at Redditch Borough Council say it is too early to make a link between the rise and the introduction of the Council Tax Support Scheme in April, which saw 4,600 households charged at least 20 per cent of their council tax bill for the first time.

It followed the Government’s decision to scrap Council Tax Benefit and order councils to replace it with their own local scheme.

But the funding given to Redditch Borough Council to cover the cost was cut by 10 per cent resulting in a £650,000 shortfall shared between the authority, county council, police and fire authorities, which had to be filled.

As pensioners were protected, the cut fell on working age claimants in both private and social housing, leading to concerns at the time the changes could result in people finding themselves in financial difficulty and unable to pay the bill or their rent.

Figures show in the first six months of the scheme for the 685 council tenants affected by the change 48 per cent of those affected saw their rent arrears increase compared to 52 per cent of households where rent debt has fallen.

But overall there has been a surge in measures carried out by the council to try and claw back money owed, with more than twice as many people facing recovery action compared with the same time last year. More than 6,000 first reminder letters have been sent out in 2014 compared to about 3,500 last year while in the region of 3,700 final demands have been made compared to about 2,600 over the same period. There has also been an increase in court summons and liability orders.

Despite that the amount of Council Tax collected has only dipped slightly and officers say only about 50 people have asked for help with a ‘small number’ of those being given support from a hardship fund created to support those worst affected by the changes.

Amanda de Warr, head of customer access and financial support, said those who had asked for help had received additional support, as well as money in some cases.

“There are a number of additional avenues we can take them down including applying for benefits, getting some people into training, dealing with debts etc. Any support we have given around council tax has been very short-term,” she told a meeting of the council’s executive committee.

She added recovery action was starting to level off but could take another six months before it began to reduce.

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