Agenda item

(Finance Portfolio Holder) To consider the attached report (C-043-2015/16).

(1)        That the Policy for the introduction of Council Tax and Housing Benefit Civil Penalties be approved.

The Finance Portfolio Holder presented a report on the Council Tax and Housing Benefit Civil Penalty Policy.

The Portfolio Holder reported that the Local Government Finance Act 1992 and Social Security Administration Act 1992 enabled the Authority to impose a civil penalty for instances where a person had either falsely given information, or failed to report a change in their circumstances, which had resulted in either a Council Tax discount or exemption being granted, or Housing Benefit being paid, when there was no entitlement. The Council could impose a civil penalty of £70 for Council Tax discounts and exemptions, and a £50 civil penalty for Housing Benefit. The Authority had not previously imposed such penalties but there were benefits to be gained from introducing them. It was highlighted that the Policy included both a right of appeal and a number of exceptions.

When questioned about the loss to the Council from incorrect information being provided for Council Tax and Housing Benefit claims, the Director of Resources stated that the Council did not have precise figures but previous data matching exercises undertaken had generated tens of thousands of pounds of additional income for the Council from incorrectly claimed Single Persons Discounts. It was highlighted that fraud was a problem across the whole country, and Epping Forest was not immune to this.

The Cabinet welcomed the fact that one of the exceptions listed in the Policy was if the Applicant realised that they had made a mistake with their application and informed the Council, as this would send a positive message to residents. However, there was concern about the potential cost of appeals to the Council from applying these Civil Penalties. The Assistant Director of Resources (Benefits) informed the Cabinet that Council Tax appeals were dealt with by the Valuation Tribunal Service, whilst Housing Benefit appeals were handled by the Tribunals Service. In both cases, appeals would not generate much additional work for Officers, and there was no risk of costs being awarded against the Council if an appeal was lost.

In respect of “…falsely given information…”, the Assistant Director agreed that these could be from an instance of fraud, but for the majority of Council Tax cases the cost of prosecution was greater than the benefit from winning the court case. These were civil penalties which could be levied by the Council without the involvement of the courts, although more serious cases of fraud would still be prosecuted in the courts. The Council would still collect the overpayment; the civil penalty was simply a fine on top of that.

Decision:

(1)        That the Policy for the introduction of Council Tax and Housing Benefit Civil Penalties be approved.

Reasons for Decision:

The introduction of Civil Penalties would act as a deterrent to people who might be incorrectly claiming a Council Tax discount or exemption, or an increased payment of Housing Benefit. It would also help to ensure that the Tax Base was accurate as well as provide an additional income stream to the Authority.

Other Options Considered and Rejected:

To not impose Council Tax and Housing Benefit civil penalties. However, this would provide no disincentive for residents not to notify a change in circumstances or provide false information.