Agenda item

The Revenue Support Manager presented the Discretionary Council Tax Reduction Policy 2026/27.

Cabinet was advised that the authority reviewed the content of the Discretionary Council Tax Reduction Policy on an annual basis.  The Council had discretionary powers to amend or reduce Council Tax, including through assessment on a case-by-case basis.  Decisions on Council Tax reduction were subject to a review process and tax payers could appeal decisions if they disagreed with the decision made by the authority.

The Discretionary Council Tax Reduction Policy needed to support speedy and transparent decision-making.  In addition, Tribunals expected Councils to have a policy for discretionary Council Tax reductions.

Within the Council’s existing Discretionary Council Tax Reduction Policy there were four criteria:

·             Reductions for care leavers aged 25 or under.  Worcestershire County Council worked with the authority to help clarify eligible candidates.

·             The flood recovery framework, which applied to householders that had been impacted by a flooding incident.

·             Any other Government additional support.

·             Other cases, which were assessed on a case-by-case basis under exceptional hardship arrangements.

In the updated policy, an additional category was proposed in respect of Council Tax reductions for households in which there was a resident who was terminally ill.  This additional category had been proposed following receipt of communications from charities that supported people who were terminally ill and their carers.  Previously, the position of residents who were terminally ill had been considered in relation to exceptional hardship arrangements.

In considering the proposed new category, Members were asked to note that this reduction would not apply to every household in which there was a resident who was terminally ill.  Before a decision would be taken, the Council would consider the financial income for the household.  There would be a need to achieve a balance in decision-making between providing appropriate levels of financial support and meeting the authority’s duty of care.

Consideration had originally been given to amending the policy in this manner in January 2026.  However, Officers had been asked to research practices in other parts of the country before taking this forward.  Subsequently, Officers had established that none of the Councils in South Worcestershire had included this category in their Discretionary Council Tax Reduction Policies and neither had Wyre Forest District Council.  All of these authorities assessed Council Tax reductions in relation to hardship arrangements when supporting terminally ill residents.  There were some larger local authorities, including Manchester City Council and Bristol City Council that had already introduced this category alongside Redditch Borough Council and different approaches had been adopted at these authorities.

During consideration of this item, the Chairman of the Overview and Scrutiny Board advised that the report had been scrutinised at a meeting of the Finance and Budget Working Group.  During this meeting, there had been two distinct views that had been raised by Members:

·             Some Members had argued that if a resident was terminally ill the evidence of that illness should be sufficient for that resident to be eligible for discretionary Council Tax reduction without means testing.

·             Other Members had commented that there should be targeted support for terminally ill residents.  In this scenario, terminally ill residents in receipt of personal income above a certain threshold should not be eligible to receive Council Tax reduction.

No consensus had been reached at the meeting of the Finance and Budget Working Group on a preferred way forward and therefore no recommendations had been made to the Cabinet on this subject.

Members subsequently discussed the following matters in detail:

·             The extent to which the Council’s current policy provided sufficient flexibility to apply Council Tax reductions for terminally ill residents.  Clarification was provided that limited support could be provided under exceptional hardship arrangements.

·             The approach that would be adopted under the proposed new policy and whether residents’ income would be taken into account.  Officers confirmed that residents’ incomes would be taken into account when assessments were undertaken.

·             The position of homeowners who lived alone who had been diagnosed with a terminal illness and how their eligibility would be assessed.  Cabinet was advised that a compassionate approach would be adopted and, where appropriate, recovery of debts could be deferred until after the residents’ death, to be obtained from their estate.

·             The extent to which terminally ill residents and their carers were likely to be aware of or to think about applying for discretionary Council Tax reduction.  Members commented on personal experiences in which many such considerations were unlikely to have been their focus at the time of a loved one’s diagnosis.  The suggestion was made that instead, information about the availability of support should be shared with palliative care teams and hospices, which could then assist residents and their carers.

·             The decision-making process that would apply in determining eligibility.  Confirmation was provided that Officers would gather evidence and would make the decisions in line with a framework.  Cabinet was informed that the first stage of appeal would be referred to an officer.  A second appeal stage would involve referral of the case to an evaluation tribunal.

·             The extent to which residents would be liaising with Officers in person or by phone, rather than the Council using artificial intelligence.  Officers confirmed that staff would liaise directly with residents.

·             The extent to which there was a risk of legal action being taken by the Council to recover Council Tax debts whilst a resident was experiencing terminal illness.  Members were assured that the Council would continue to adopt a compassionate approach to debt recovery and that the authority did not take court action against terminally ill residents.

·             The fact that the proposed changes reflected best practice and the likelihood that other Councils would adopt similar arrangements in future. 

·             The annual reviews of the Discretionary Council Tax Reduction Policy that would continue to take place and the potential for amendments to be made to the policy as further information emerged about best practice across the country.

·             The extent to which it was likely that a future Unitary Authority would adopt a similar approach.  Cabinet was informed that the Members of the future Unitary Authority would need to determine their own policies.

·             The potential for the financial impact of this policy in relation to all precepting authorities to be explored at a meeting of Worcestershire Leaders’ Board.

RECOMMENDED that the revised section 13A(1)(C) policy be approved and adopted.