The government has announced plans to overhaul the administration of council tax, with the goal of making the system fairer across the country.
In a bid to address the lack of funding for councils across certain parts of the country, the government will completely reform local government funding, addressing what it recognises as the unfair allocation of council tax based on outdated property values.
It plans to overhaul the current, outdated funding methodology currently used to fund councils and rework allocations so they are based on the latest available data.
The goal of this reform is to increase the available funding for those places the outdated system has left behind.
Inevitably, this shake-up of council tax allocations will lead to changes in how much council tax residents of certain areas pay, with those who live in areas with sufficient funding and high property values at risk of seeing council tax hikes to balance out poorly-funded councils in less affluent areas.
The consultation process announced today will take eight weeks from today and investigate a range of considerations for local government funding.
These include accounting for the increased cost of service delivery to rural areas, recognition of deprivation in urban areas, and updating the formula used to allocate funding to authorities that provide adult social care.
“There’s broad agreement across council leaders, experts, and parliamentarians that the current funding model is broken and unfair,” said Minister for Local Government and English Devolution Jim McMahon.
“This government is stepping up to deliver the fairer system promised in the 2017 Fair Funding Review but never delivered.”
“These reforms are urgently needed to put councils on a stable footing and ensure better services for residents — especially working people — right across the country,” he said.
Council tax will also become easier to pay, with 12 monthly instalments becoming the default and the billing system set to be modernised.
Better protection will be provided to those who fall behind on council tax bills and face spiralling debts, and the government is also exploring providing more transparency on how council tax funds are spent.
“We are listening and taking action to make council tax fairer, more transparent and easier to manage. Under our plans, local government will be there to support, and not to punish, people who fall behind,” McMahon said.
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