Council Tax: Councils face 'considerable challenge' in collecting debts – changes are due

COUNCIL Tax collection practices are set to be upended over the coming months, as the Government faces “considerable challenges” in managing the billing process. In a bid to help manage this, the Ministry of Housing, Communities and Local Government will be focusing on simplifying its language.

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Council Tax collection practices came into focus over the last year or so, as coronavirus forced many families into economic uncertainty. With this in mind, the Government has released best practice guidance for local authorities.

In terms of engaging with bill payers, the guidance detailed: “Communications with residents should be designed to prompt timely payment from residents who can pay, and early engagement from those who may have difficulties in keeping up with paying the necessary instalments on their bill, and may be in broader financial difficulty.

“Local authorities face a considerable challenge in managing the scale of the billing process, and the engagement that is necessary to support residents.

“To help navigate this challenge, some authorities actively work to reframe the content of their bills and improve the effectiveness of their communication.”

The guidance went on to highlight the best methods for handling these difficulties.

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Council Tax

Council Tax guidance has been issued (Image: GETTY)

It continued: “For example, some authorities have taken steps to simplify the text in their letters as far as possible.

“Their experience suggests that even subtle changes can improve clarity of communication between residents and the authority, facilitating more regular payments and earlier requests for support.

“Some authorities have incorporated ‘social norming’ into their behaviourally-informed letters.

“By highlighting the fact that a very high proportion of Council Tax is paid on time, letters can nudge residents towards payment and have increased collection rates.

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“To maximise the chances of timely payment and early engagement, authorities may wish to ensure that communications with their bills convey, in clear and simple terms:

  • “The services that Council Tax pays for
  • “The range of options available to pay the bill – this includes alternative instalment schedules, setting up direct debits on a range of different dates in the month, and paying through alternative mechanisms such as over the phone or online, where this is possible
  • “The availability of discounts, exemptions, and Council Tax support schemes
  • “The best way for residents to contact the authority and at least one debt advice body, should they find themselves in financial difficulty
  • “Clear and understanding explanation of the consequences of non-payment.”

Coronavirus

Coronavirus forced many into debt (Image: EXPRESS)

There is also a range of guidance and helpful tools available to payees, and the guidance noted these should be highlighted to savers going forward: “Authorities may also wish to signpost bill payers to the government’s Plain English guide to Council Tax, which sets out the discounts, exemptions and support available within the system.

“There may be some residents who have concerns about their finances, and are worried about the consequences of missing payments when they receive their bill. To support such groups, the Money and Pensions Service has introduced their Money Navigator Tool.

“This is a simple online diagnostic that helps consumers find the general money guidance that they need.

“After answering a series of questions (in under 30 seconds) the tool will provide tailored guidance on individual money matters and, where appropriate, it directs them to specialist third party advice that can help with problems.”

These priorities may impact thousands of families over the coming months.

In early August, the Observer reported at least 280,000 households in England were referred to bailiffs over Council Tax debt in 2020.

Additionally, more than 115,000 people had to have their benefits deducted to clear their arrears.

Guidance on how to deal with Council Tax debt and/or bailiffs can be sought from the likes of Citizens Advice and Money Helper.

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