2.2m poorer households now paying council tax

More local authorities are asking the poorest households to pay some council tax - and both minimum payments and arrears are on the rise, according to new research.

Four years after localised council tax support replaced national council tax benefit, figures from the New Policy Institute and the Joseph Rowntree Foundation show that 259 out of 326 councils now require everyone to pay at least some council tax regardless of income, nine more than last year and 30 more than April 2013.

In 2016-17, 2.2m low income families will pay on average £169 more in council tax than if council tax benefit was in place. This is up from £145 in 2013-14.

Only 41 councils continue to provide the same level of support that was available under the old system, down from 58 in April 2013.

In the first year of council tax support, funding from central government for discounts and exemptions was cut by 10 per cent. This has now been combined with local authorities' general grant and is subject to the same cuts.

Looking at minimum payments, the research found a "large and steady" drop in the number of councils with smaller payments of 8.5 per cent or less from 112 in April 2013 to 50 in April 2016.

The largest increase was among councils setting a minimum payment above 20 per cent, with the figure rising from 53 in 2014 to 67 in 2015. Eleven local authorities have a minimum payment of 30 per cent or more.

The number asking for between 8.5 per cent and 20 per cent edged up by one on last year to 65, up from 23 in 2013.

The most common minimum payment is 20 per cent, with 77 councils charging it in April 2016. This is up from 53 in April 2013.

Councils with the largest increases in minimum payments since 2012-13 have also seen the biggest increase in council tax arrears. In 2014-15, among the 45 councils that had retained support at the levels under council tax benefit, arrears fell in relative terms by seven per cent. Among other councils, the smallest increase was in the 36 that did not introduce a minimum payment. For the 69 councils with minimum payments of 20 per cent, arrears rose by 20 per cent - and in 47 areas with minimum payments over 20 per cent, arrears jumped 44 per cent.

Responding to the report, Cllr Claire Kober, resources portfolio holder for the Local Government Association, said: "The shortfall between the money councils receive to fund council tax support and the money we would need to protect those on low incomes is getting bigger. Faced with growing funding pressures, councils are increasingly unable to meet this shortfall.

"No one wants to ask those on the lowest incomes to pay more. But faced with significant cuts to the money we receive to look after the elderly, protect children, repair the roads and collect the bins, many councils have had little choice but to reduce the discount.

"Councils know how tough things are, and are doing their best to protect those affected the most, whether through introducing hardships funds or changing the way we collect unpaid tax. But these measures can only go so far in alleviating the burden."