Council Tax Collection

Housing, Communities and Local Government Committee Closed Inquiry
Opened: 15 Nov 2021 Closed: 6 Mar 2024 Parliament page
This inquiry will lookinto council tax collection in England, examining the practices employed by local authorities to collect council tax arrears. The inquiry will also look at other issues including whether there should be changes to the legislation on the recovery of council tax arrears, and how local authority council … Read more
12 Recommendations
9 Conclusions
1 Report
2 Oral sessions
8 Letters
2 Events
Activity timeline 14 events
14 May
2024
Correspondence
14 May
2024
Correspondence
16 Apr
2024
Correspondence
16 Apr
2024
Correspondence
1 Feb
2024
Report published
1 Dec
2023
Report published
18 Jul
2023
Correspondence
18 Apr
2023
Correspondence
27 Feb
2023
Oral evidence
27 Feb
2023
Formal meeting (oral evidence session) · The Wilson Room, Portcullis House
18 Oct
2022
Correspondence
12 Jul
2022
Correspondence
Oral evidence sessions 2 sessions
27 Feb 2023
View on parliament.uk
Oral Evidence
Lee Rowley · Department for Levelling Up, Housing and Communities Nico Heslop · Ministry of Housing, Communities and Local Government
6 Jun 2022
View on parliament.uk
Oral Evidence
Alistair Townsend · Institute of Revenues, Rating and Valuation Catherine Brown · Enforcement Conduct Board Councillor Stephanie Cryan · London Borough of Southwark Kevin Stewart · Mid Sussex District Council Paul Whyte · Whyte & Co Ltd Rachel Beddow · Citizens Advice Russell Hamblin-Boone · Civil Enforcement Association
Title HC No. Published Items Response
Second Report - Council Tax Collection HC 57 1 Dec 2023 21 Responded
Recommendations & Conclusions
21 results
1 Conclusion Accepted
Second Report - Council Tax Collec…
Ambiguity exists regarding local authorities' discretion for council tax repayment plans.
The Council Tax (Administration and Enforcement) Regulations 1992 requires the year’s unpaid council tax balance to become payable in certain circumstances. This provision, and the speed with which it is applied, can be the catalyst for someone’s debts to quickly … Read more
Government Response
The government acknowledges the committee's concern about clarity regarding council discretion for council tax repayment plans and commits to writing to all councils to stress their flexibility and encourage affordable repayment plans.
Ministry of Housing, Communities and Local Government
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2 Recommendation Accepted
Second Report - Council Tax Collec…
Clarify Council Tax Regulations regarding local authority discretion for unpaid balance repayment.
We strongly urge the Government to clarify the provision in the Council Tax (Administration and Enforcement) Regulations 1992 that requires the unpaid balance to become payable in certain circumstances. If local authorities do, under this provision, have the discretion not … Read more
Government Response
The government acknowledges the need for clarity regarding council discretion on council tax repayment timelines and commits to writing to all councils to stress their flexibility and encourage affordable repayment plans.
Ministry of Housing, Communities and Local Government
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3 Recommendation Accepted in Part
Second Report - Council Tax Collec…
Amend regulations to enshrine ability-to-pay principle and mandate affordable council tax repayment plans.
In addition, by the end of this Parliament, the Government should amend existing regulations to enshrine in law the principle that collection should be based on a resident’s ability to pay, including by requiring local authorities to offer people affordable … Read more
Government Response
The government partially accepts the recommendation by committing to write to all councils to stress their discretion in offering flexible payment timelines and encouraging affordable repayment plans, but it does not commit to amending existing regulations to enshrine this principle in law.
Ministry of Housing, Communities and Local Government
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4 Recommendation Accepted
Second Report - Council Tax Collec…
Streamline the council tax liability order process, allowing bulk and virtual applications.
The process for obtaining a liability order is inefficient and can hinder, rather than aid, the collection of unpaid council tax. We therefore strongly recommend that the Government make the liability order process less burdensome, including by allowing bulk applications, … Read more
Government Response
The government states that bulk applications for council tax liability orders have been common practice since 1992, and virtual hearings are already lawful and remain an available option for magistrates’ courts.
Ministry of Housing, Communities and Local Government
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5 Conclusion Acknowledged
Second Report - Council Tax Collec…
Imprisonment for council tax arrears is a disproportionate sanction impacting household essentials.
We are concerned that the threat of enforcement might mean people are putting their council tax payments ahead of heating and eating. In particular, we believe the ultimate sanction of imprisonment is using a sledgehammer to crack a nut.
Government Response
The government acknowledges the committee's concerns regarding the threat of enforcement and imprisonment for council tax non-payment, explaining that imprisonment is a rarely used sanction for those who can but wilfully refuse to pay, with existing safeguards in place.
Ministry of Housing, Communities and Local Government
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6 Recommendation Rejected
Second Report - Council Tax Collec…
Replace council tax imprisonment sanction with alternative deterrents such as bank arrestment or community service.
The Government should amend existing regulations by the end of this Parliament to replace the sanction of imprisonment with more suitable deterrents, such as bank arrestment or community service.
Government Response
The government implicitly rejects the recommendation, defending the existing sanction of imprisonment for wilful non-payment of council tax as a rarely used but necessary tool, and states there are protections in place for residents.
Ministry of Housing, Communities and Local Government
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7 Conclusion Accepted
Second Report - Council Tax Collec…
Local authorities must consider ability to pay when collecting council tax arrears from the vulnerable.
The localisation of council tax support, and local government’s increasing reliance on revenue from council tax, has put local authorities in the difficult situation of occasionally having to collect council tax arrears from those in financial need. In this context, … Read more
Government Response
The government acknowledges the committee's views and responds by outlining the existing statutory framework for council tax collection, which includes multiple communications and allows councils the discretion to offer flexible repayment arrangements and assess discounts, suggesting current practices already take account of an individual's ability to pay.
Ministry of Housing, Communities and Local Government
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8 Conclusion Accepted
Second Report - Council Tax Collec…
Rushing council tax recovery from those unable to pay wastes resources and causes distress.
Council tax is unlike other debt, in that it recurs annually, so it is in the interests of residents that arrears be collected swiftly so they do not quickly escalate. However, if an individual genuinely cannot afford to pay, rushing … Read more
Government Response
The government acknowledges the committee's views and outlines the existing statutory framework and guidance for council tax collection, which allows councils flexibility for repayment arrangements and assessing discounts, suggesting current practices align with the spirit of the conclusion. It also confirms no plans for a statutory code of practice.
Ministry of Housing, Communities and Local Government
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9 Recommendation Rejected
Second Report - Council Tax Collec…
Current council tax collection guidance lacks specific standards, requiring a statutory code of practice.
The council tax collection best practice guidance, issued by the Department for Levelling Up, Housing and Communities in 2021, does not set out specific standards expected of local authorities. We agree with the Government that local authorities’ need some discretion, … Read more
Government Response
The government rejects the implicit recommendation for a statutory code of practice, stating it has no plans to replace existing guidance with a statutory code and prefers local authorities to retain discretion.
Ministry of Housing, Communities and Local Government
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10 Recommendation Rejected
Second Report - Council Tax Collec…
Introduce a statutory code of practice for council tax collection, including affordable repayment plans.
We recommend that the Government replace the council tax collection best practice guidance with a statutory code of practice, to which local authorities would have to have regard. Among other things, this code of practice should set out what steps … Read more
Government Response
The government rejects the recommendation to replace existing council tax collection guidance with a statutory code of practice, asserting that a clear statutory framework is already in place for councils, offering flexibility for repayment and support.
Ministry of Housing, Communities and Local Government
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11 Recommendation Not Addressed
Second Report - Council Tax Collec…
Require local authorities to exhaust alternatives before using enforcement agents for council tax arrears.
The use of enforcement agents to collect unpaid council tax should always be a last resort, so we were pleased to hear that many councils and debt collectors engage with residents to collect arrears without needing to take enforcement action, … Read more
Government Response
The government's response outlines existing collection processes and councils' flexibility but does not commit to directing local authorities on the careful consideration or exhaustion of alternative methods before using enforcement agents, particularly for those receiving council tax support.
Ministry of Housing, Communities and Local Government
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12 Conclusion Accepted
Second Report - Council Tax Collec…
Voluntary funding model for Enforcement Conduct Board is precarious, requiring a statutory review.
We welcome the establishment of the Enforcement Conduct Board (ECB), and, most recently, the launch of its accreditation scheme, but we regret that the ECB is dependent for its funding on a voluntary industry levy. We are concerned that industry … Read more
Government Response
The government broadly agrees with the committee's points, confirming its commitment to launch a review on statutory underpinning for the ECB and stating DLUHC will write to local authorities encouraging them to use ECB-accredited firms.
Ministry of Housing, Communities and Local Government
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13 Recommendation Accepted in Part
Second Report - Council Tax Collec…
Mandate local authorities to only use Enforcement Conduct Board registered enforcement agencies.
In preparation for this review, we recommend that the Government start to collect the necessary data, so that it has a strong evidence base on which to make a decision, and that it keep us updated on the progress of … Read more
Government Response
The government agrees to update the committee on the upcoming review process, including data collection methodology. While not requiring local authorities to use ECB-registered firms, DLUHC will write to councils encouraging them to use accredited firms.
Ministry of Housing, Communities and Local Government
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14 Conclusion Accepted
Second Report - Council Tax Collec…
Barriers to data sharing still impede councils identifying vulnerable residents for support.
We welcome the many initiatives, by local and central government, aimed at improving data sharing, particularly the pilots being carried out under the Digital Economy Act 2017 and the creation of the Office for Local Government; but overall we remain … Read more
Government Response
The government describes ongoing efforts to improve data sharing with councils, including increasing data scope, delivering improvements to shared data by summer 2024, ensuring councils are aware, and exploring legislative amendments, to help councils identify residents in hardship.
Ministry of Housing, Communities and Local Government
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15 Recommendation Accepted in Part
Second Report - Council Tax Collec…
Create an environment enabling easy, consistent data sharing to identify residents at risk of arrears.
The Government should not wait for local authorities to approach the Cabinet Office to learn how they can make better use of data sharing, but instead create an environment where this happens easily and consistently. We recommend that: • an … Read more
Government Response
The government rejects the recommendation for universal credit applications to automatically trigger local council tax support applications due to potential bureaucracy. However, it outlines ongoing and planned actions to improve data sharing between DWP and councils, including increasing the scope of MOUs, delivering data improvements, and exploring legislative changes.
Ministry of Housing, Communities and Local Government
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16 Conclusion Rejected
Second Report - Council Tax Collec…
Central government lacks crucial understanding of national council tax arrears drivers and causes.
The Minister said it was for local authorities to understand the drivers of council tax arrears in their areas, but we believe that central government has a vital role to play in building a national picture of the causes of … Read more
Government Response
The government rejects the committee's concern that it lacks a national understanding of council tax arrears, stating that the complexity of local schemes and factors makes formal research unhelpful, and it has no plans to collect further data due to burdens on councils.
Ministry of Housing, Communities and Local Government
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17 Recommendation Rejected
Second Report - Council Tax Collec…
Publish research assessing council tax support schemes and comprehensive local authority arrears data.
The Government should carry out and publish research to assess different types of local council tax support schemes and how they relate to council tax arrears. In addition to collection rates and levels of arrears, the Government should also publish … Read more
Government Response
The government rejects the recommendation to carry out research and publish local authority data on council tax support schemes and arrears, stating such research would not be useful and collecting the data would burden councils.
Ministry of Housing, Communities and Local Government
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18 Recommendation Deferred
Second Report - Council Tax Collec…
Urge Secretary of State to confirm Oflog Chair pre-appointment hearing status for committee scrutiny.
We are closely monitoring the establishment of the Office for Local Government which we believe could help to improve the functioning of local government. However, it is regrettable that the Secretary of State has not yet confirmed that the position … Read more
Government Response
The government defers confirming that the Oflog Chair position will be subject to pre-appointment scrutiny, stating the Department will consider if the role meets the criteria as part of its preparations for appointing a permanent Chair.
Ministry of Housing, Communities and Local Government
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19 Conclusion Rejected
Second Report - Council Tax Collec…
Outdated council tax collection system increasingly drives more residents into arrears.
The entire system for collecting council tax is outdated and not meeting its desired purpose. This has become increasingly problematic because councils are becoming ever more reliant on council tax for their budgets. In 2015/16, council tax made up 49.1% … Read more
Government Response
The government rejects the implied need for a revaluation of council tax bands, citing cost and potential negative impacts on lower-income households. It states a commitment to improving the local government finance landscape in the next Parliament, prioritizing stability in the current one.
Ministry of Housing, Communities and Local Government
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20 Conclusion Rejected
Second Report - Council Tax Collec…
Ministerial commitment to reviewing essential council tax reform has become uncertain.
In November 2022, the Secretary of State agreed there was a case for reforming council tax and said he had asked the previous Minister to look into it. Unfortunately, the previous and current Ministers have since cast doubt on the … Read more
Government Response
The government rejects undertaking a revaluation of council tax bands, citing costs and potential negative impacts on residents, and states it is prioritizing stability in this Parliament while committing to improving the local government finance landscape in the next Parliament.
Ministry of Housing, Communities and Local Government
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21 Recommendation Rejected
Second Report - Council Tax Collec…
Reform council tax through property revaluation, new bands, and wider long-term options.
We stand by our previous conclusions, and those of our predecessor Committee: the council tax regime is in desperate need of reform and updating. We recommend that the Government reform council tax by undertaking a revaluation of properties and introducing … Read more
Government Response
The government rejects the recommendation for council tax reform, specifically refusing property revaluation and additional bands due to cost and potential impact on low-income households, deferring wider reform considerations to the next Parliament.
Ministry of Housing, Communities and Local Government
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Government Response AI assessment · 21 of 12 classified
Accepted 7
Accepted in Part 3
Acknowledged 1
Deferred 1
Not Addressed 1
Rejected 8
Total 12 recs + 9 conclusions
Correspondence 8 letters
14 May 2024 To committee Letter from the Minister for Local Government to the Chair dated 2 May 2024 concerning the Government’s response to the Committee’s Report on Council Tax Collection
Parliament page
14 May 2024 To committee Letter from the UK Information Commissioner to the Chair dated 2 May 2024 concerning the Committee’s Report on Council Tax Collection
Parliament page
16 Apr 2024 To committee Letter from the Chair to the Secretary of State dated 15 April 2024 concerning the Government response to the Committee's report on Council Tax Collection
Parliament page
16 Apr 2024 To committee Letter from the Chair to the Information Commissioner's Office dated 15 April 2024 concerning the Government response to the Committee's report on Council Tax Collection
Parliament page
18 Jul 2023 To committee Letter from the Enforcement Conduct Board to the Chair dated 14 July 2023 concerning council tax collection
Parliament page
18 Apr 2023 To committee Letter from the Enforcement Conduct Board to the Chair dated 28 March 2023 concerning council tax collection
Parliament page
18 Oct 2022 To committee Letter from the Enforcement Conduct Board to the Chair dated 10 October 2022 concerning council tax collection
Parliament page
12 Jul 2022 Letters from the Civil Enforcement Association to the Chair dated 20 June 2022 concerning Council Tax Collection
Parliament page