Vulnerable pensioner, 76, fears ‘being taken to court’ over £13 council tax arrears

Council tax debt has become a real issue in light of the coronavirus epidemic. According to research conducted by the three organisations, over two million people are behind on their council tax bills due to the virus.

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This could be made worse by council tax enforcement measures likely to be restarted soon.

These measures could put already struggling residents under further financial hardship.

On top of this, councils have been known to utilise their powers to bring in bailiffs for debt collection with 1.4million council tax debts being passed on to bailiffs in 2018/19.

If this trend continues, it will add further costs and fees onto people’s problems.

While the government have introduced a temporary ban on bailiff visits, the three charities fear that there may be a sudden escalation of enforcement when the ban lifts.

With these troubling finding on council tax debt, they called on the government to take the following measures:

  • Introduce a ‘pre-action protocol’ for councils to follow before beginning to enforce council tax recovery. This would include a requirement to set up an affordable repayment plan.
  • Encourage councils to collect debts over more than one year by changing collection rate targets.
  • Stop people becoming automatically liable for their entire annual bill when they fall behind on instalments.
  • Provide more hardship funding to councils to reduce council tax arrears accrued as a result of Covid-19.

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The report put together on this estimates that there is approximately £3billion owed in unpaid council tax.

While this is a worrying figure and many will likely sympathise with underfunded councils, the repercussions of aggressive recuperation methods can be illustrated by examining individual cases.

Marie, 76, usually paid her council tax via Paypoint at the Post Office.

However, she was forced to shield due to her age and health issues, which include managing a chronic lung condition.

Despite the direness of her situation, her local council contacted her regarding council tax arrears of a mere £13 and threatened her with a liability order.

She was eventually informed that she may be “taken to court” which frightened her due to all of the lockdown measures.

The report highlighted that when inability orders begin to be issued again following the brief ban from the state, she will likely face enforcement action.

It’s because of situations like these that have resulted in all three of the charities writing to Simon Clarke, the Minister for local government, outlining their recommendations.

The leaders of all three charities provided the following comments on what they’d like to see changed from the government:

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Dame Gillian Guy, chief executive of Citizens Advice

“Coronavirus has caused huge financial uncertainty for local councils. But this pressure must not trigger a wave of aggressive debt collection against people who are themselves struggling to pay their bills.

“Aggressive collection drives vulnerable people further into debt and is inefficient. Councils get back just 27p for every £1 of debt passed on to bailiffs.

“The government must urgently change the rules so local authorities can collect council tax debts fairly and sustainably. Otherwise millions of people could face the prospect of heavy-handed bailiff enforcement on bills they can’t afford to pay.”

Joanna Elson OBE, chief executive of the Money Advice Trust

“There can be no going back to ‘business as usual’ for council tax collection.

“With millions at risk of falling behind with their council tax bills, the government should move quickly to address the weaknesses in the way local authorities collect arrears from people in debt – to ensure that this is fair, proportionate and does not make bad financial situations worse.

“At the same time, councils need more funding for both existing Council Tax Support schemes and to support residents in hardship in other ways.

“This needs to be put in place right away, so that local authorities can play their part in supporting the nation’s financial recovery from the outbreak.”

Phil Andrew, chief executive of StepChange Debt Charity

“Council tax is often one of the bills that households experiencing financial difficulty struggle to pay, yet enforcement of it is harsher and more punitive than most other forms of debt.

“Particularly this early in the Council Tax year, if people miss a payment and become liable to repay the full amount, this is a worry.

“The Government needs to take steps both to support councils who will understandably be worried about their funding, but also to require them to adopt fair and compassionate approaches to residents who fall into arrears as a result of the current situation.”

In response to the report, a spoksperson from the Ministry of Housing, Communities and Local Government said the following: “

“Council tax plays an important part in funding frontline services in the coronavirus response but we expect councils to be sympathetic to those in genuine hardship.

“We’ve introduced a £500 million hardship fund that builds on local support schemes by further reducing the council tax bills of some of the most vulnerable households by up to £150.

“We’ve also changed the law to protect households by banning enforcement visits from bailiffs at residential premises for the duration of the pandemic in line with public health guidance.”

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