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Scrap plans to cut council tax benefit, Labour Party tells Hackney Council as consultation draws to a close

PUBLISHED: 07:00 02 November 2017

A view of Hackney looking towards the town hall in Mare Street. Hackney Council is consulting on increases to council tax. Picture: Melissa Page

A view of Hackney looking towards the town hall in Mare Street. Hackney Council is consulting on increases to council tax. Picture: Melissa Page

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Hackney Council has seen a backlash within the Labour Party over plans to increase council tax contributions for some of the borough’s poorest people.

Mayor of Hackney Phil Glanville: 'Council tax changes not an easy decision.' Picture: Gary Manhine/Hackney Council Mayor of Hackney Phil Glanville: 'Council tax changes not an easy decision.' Picture: Gary Manhine/Hackney Council

The council is consulting on whether to change its council tax reduction scheme, which it says has become “too costly to administer” at £25.5 million a year for its 32,000 recipients.

The proposal is to reduce the 85pc reduction for working age residents by 5pc by April. The contribution of a single parent with four children at school living on jobseekers’ allowance and child tax credits, living in a band E property, could rise from £3.50 to £6.43 a week, for example.

And a single person over 35 with employment support allowance of £73 weekly, living in a band B property, could see payments rise from £2.23 a week to £4.09 a week. But pensioners would not be affected.

Some community and political groups are opposed to the plans and Hackney South Labour Party has voted for a motion asking the council to reconsider – and even go as far as scrapping council tax charges for the poorest altogether.

Protest: Ripon Ray. Protest: Ripon Ray.

Debt advisor Ripon Ray, who put forward the motion, negotiates repayment plans with Hackney Council. He has seen a big increase in people ending up in council tax arrears since the scheme to charge council tax contributions to those on a low income was introduced in 2013.

His motion suggests covering the cost by “rethinking empty property relief and penalty charges or a small hourly rise in car parking charges” – or as a last resort to implement a “necessary small rise” in other people’s council tax payments.

Penny Wrout, who voted in favour of the motion, said: “The government shunted responsibility for the benefit over to local authorities a couple of years ago, but omitted to allocate sufficient funds to cover it.

“But many Labour members like myself feel that cutting the benefit for the poorest people in the borough isn’t the way forward.”

"Many Labour members like myself feel that cutting the benefit for the poorest people in the borough isn’t the way forward."

Penny Wrout

The Hackney Green Party also has concerns. Samir Jeraj said: “Some of the poorest people will see their council tax go up by 80pc. Before they respond to the consultation, residents deserve to know what the impact will be on child poverty, on the increased use of bailiffs against people who cannot pay, and on the increase in doorstep lenders.”

Hackney mayor Phil Glanville said it hadn’t been an “easy decision”, and that many other options had been considered – but it had been decided the proposal was the “fairest option”.

“When the government handed responsibility for administering council tax-related benefits to local government, it did so with a massive funding shortfall, on top of a huge reduction in overall funding for councils,” he said.

“We will continue to provide extra support for the most vulnerable people. In addition, local care leavers will now be exempt from paying council tax and those fleeing domestic abuse will not have to pay it for a second property.”

Green Samir Jeraj: 'Residents deserve to know what the impact will be on child poverty.' Green Samir Jeraj: 'Residents deserve to know what the impact will be on child poverty.'

The consultation ends on Monday. See consultation.hackney.gov.uk.

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