Rishi Sunak announced last week, that all Direct Debit payers of Council Tax (bands A to D), will receive a one-off payment of £150 to help with the rising cost of living.
£150 should make a massive difference, Mr Sunak…
It seems like a simple enough gesture, even well meaning, but many top finance figures claim that it will cause too much complexity and risk, not to mention cost.
The issue comes from muddying the waters between Council Tax and energy bills, which, essentially, is all this does.
Instead of addressing the key issue, which is that soaring energy bills will now cost the average family almost £700 more per year, this Government ‘plan’ makes it seem as though the two financial responsibilities on households are the same.
In fact, energy bills and Council Tax bills are completely separate entities, and in many peoples’ opinion, one should not offset the other, especially when Council Tax bands do nothing to consider the different financial situations of individual households and families, wherever they may be living.
The Council Tax system is outdated, and based on drive by assessments of streets and properties, rather than on individual incomes and situations. It’s a one size fits all approach for a system of many sizes. This universal (ish) payment of £150 could be loose change to some, but nowhere near enough to help others.
But that’s just one part of it…
It is also thought that the timing is out of whack, as Councils are just about to issue Council Tax bills, and so this throws everything more than a little askew. It feels like a ‘knee jerk’ policy, rather than one that has been thought through. The implementation certainly hasn’t been thought through, and there is concern that it could actually cost Councils more than it needs to, if new software is needed to ensure everyone receives their payment, as is likely to be the case.
Rich or poor, no one is likely to turn their nose up to £150 back off their Council Tax bill, but the real question is whether or not this will actually help those who are truly vulnerable, or just look good for an under pressure Government, who maybe aren’t doing enough to address the root cause of the problem.