Struggling households face postcode lottery to get their £150 council tax rebate

Households struggling with a rising cost of living and soaring energy bills face a “postcode lottery” to get their £150 council tax rebate as some local authorities have struggled to deliver the payments.

Chancellor Rishi Sunak unveiled the energy support measure in February to help households with the cost of living crisis. Payments were due to be rolled out by councils from April onwards when the energy price cap increased.

But some local authorities have found the roll-out of the rebate “challenging” with warnings that some payments could now take until the 30 September deadline to go through.

One council source told the scale of the task had been “underestimated” by both the Government and the public for teams already stretched to the limit after working to hand out Covid emergency grants.

And charities now fear those in greatest need will suffer as it takes months to issue the rebate.

Dr Zubaida Haque, executive director of charity The Equality Trust, which campaigns to reduce economic and social inequality, told : “There are so many issues with the £150 council tax rebate, not least that many low income households have had to pay up to two council tax bills upfront since the beginning of April, and are still waiting for the rebate.

“It also feels very wrong that households who are able to afford direct debit council tax payments, normally more financially secure households, are receiving their rebates much earlier compared to low income households who are having to apply through the post/online.”

She said the rebate excludes one in eight of the poorest families because they fall outside the council tax bands A-D criteria and do not qualify.

And she pointed out it was “a drop in the ocean when low income households are approximately £1,100 worse off since the Chancellor took away the £20 uplift to universal credit.”

She said the most effective way to help low income households was through benefits, paid directly into bank accounts so they can plan ahead.

Adam Scorer, chief executive of National Energy Action (NEA), has described the Government’s response to the energy crisis as “wholly inadequate so far”.

“We’ve got serious concerns about the way the council tax rebate is being implemented”, he said.

“Councils across the country have their own way of administering the scheme, creating a postcode lottery for struggling households.”

The rebate only applies to households in council tax bands A through to D in England, with similar schemes operating in Scotland and Wales.

Mr Scorer said: “While the Treasury said that there would be money for other vulnerable households outside of the eligibility, they will often need to self-identify, rather than just getting the rebate automatically, which could see desperate households slipping through the cracks.

“It’s estimated that over 600,000 low-income households fall outside of bands A to D, and many of those will not have access to the support. “

And he warned that “when the [energy] price cap rises again in October and the temperature begins to drop, millions of households are going to be pushed below the waterline unless the government introduces a new, adequate package of support.”

For councils trying to implement a system to make the rebate payments it has been “a significant task and not without its challenges”, according to the Local Government Association (LGA).

Cllr Shaun Davies, the LGA’s Resources Board chairman, said: “Councils know that this year will be tougher than most, particularly for those on lower incomes, and have worked hard to get energy rebate payments out to millions of eligible households.”

He said some councils have begun making payments this month to allow software to be fully tested and to ensure April direct debit payments are not recalled. He said many are now focusing on contacting those eligible who do not pay their council tax by direct debit.

Labour MP Matthew Pennycook defended councils saying they had “attracted a fair amount of implicit criticism” over their handling of the council tax rebate but most were doing a “sterling job under extreme pressure”.

He added “it was entirely the government’s choice to disperse support in this most complicated of ways”.

The LGA said member councils had expressed considerable concerns about the administrative burden of the rebate.

Problems include direct debit details not matching those liable for the rebate and rebate applicants without a council tax direct debit arrangement with the local authority, who must then make a separate application.

Bristol City Council said the first phase of its payments was made on Monday for those who pay council tax by direct debit, while those without a direct debit arrangement would have to fill in a form from 23 May to apply for the rebate.

Councillor Craig Cheney, the city’s deputy mayor, said the council was “grateful for everyone’s patience” while it implemented the new system.

Wealden District Council in East Sussex said its rebate application process for those without direct debit arrangements would begin in June.

A government spokesperson said: “The £150 council tax rebate is just one part of the government’s £22 billion package of support that will help millions of people deal with rising living costs, and most councils have already started paying it.

“While direct debit is the quickest and easiest way to get the rebate, councils have a range of other options for people who don’t pay by direct debit.”

The Department for Levelling Up, Housing and Communities said councils received the rebate funding on 30 March, are expected to begin the payments as soon as possible and would be reimbursed for administrative costs.