Council tax benefit cap plans announced by government

The government has announced plans to impose a cap on the amount of money paid to councils in council tax benefit. Currently, residents apply to their local authority for the benefit, which is claimed by around 5.8 million people in England on low incomes. The council then bill the Department for Work and Pensions and distribute the money to those in receipt of benefit. However, the cost of this type of support is £4.8bn a year which the government claims is unaffordable. Coalition plans would see funding cut by 10% which would effectively impose a cap on spending and encourage councils to find more savings to maintain current benefit bills. Authorities will also have the power to alter criteria for council tax benefit which could produce savings if eligibility were restricted. There are concerns that the plans could see some households have their benefit cut. Councillor David Sparks, Local Government Association vice-chair, said: "Giving councils the freedom to target council tax relief at those residents who really need it will give local authorities greater autonomy, but big cuts to the money available mean that adopting responsibility won't be easy. It is essential the changeover is done in a way that does not disadvantage the elderly and most vulnerable in society, or draw money away from other vital council services. Funding must also be flexible enough to ensure local areas are not left out-of-pocket by any future increase in demand." The government has announced an 11-week consultation on the issue. Communities secretary Eric Pickles said : "In future councils will have a much greater stake in the economic future of their area and greater incentives to support local residents back into work. The new system will be a fairer one, where hard-working families and pensioners are not left to pick up a spiralling benefits bill and where hard work always pays." This content is brought to you by Guardian Professional. Sign up for the local government network newsletter for comment, analysis, best practice and events direct to your inbox