To recommend to Council the future approach to distribution of the council tax reduction scheme grant funding.

The cabinet member for economy and corporate services provided some background to the scheme which was introduced in 2013:

•           receipts were at 100% until central government increase the responsibility on councils to claim and reduced support to 90%;

•           from 2013 the grant was absorbed into the revenue support grant, which then reduced as reflected in the medium term financial strategy;

•           the council continued to subsidise parish precepts and had a legal obligation to deliver 100% of the set precept irrespective of whether people paid their council tax. The shortfall would have been made up through this grant last year.

The grant would be replaced by a small charge in council tax with the average impact being £3.63 per year per household.  There would be no reduction on what parishes received and this was included in the recent council tax consultation. There were five parishes where the impact would be phased and there had been discussion with town, city and parish councils who accepted this was the right way to support.

The leader of It’s Our County observed that the city council fell below the threshold for town councils and it was confirmed that it was aware of this. 

RESOLVED THAT:  the following be recommended to Council:

(a)        the council tax reduction scheme funding passed to parish councils is withdrawn in 2016/17; and

(b)       for five parishes: Bromyard and Winslow Town; Kentchurch; Kington Town; Ledbury Town; and Leominster Town councils, where the impact of withdrawal would result in an increase in the annual council tax charge of 0.4% or more in any one year the withdrawal be phased over a period of up to three years.