Fears that Council Tax collection rates will fall due to cost of living crisis

At a meeting of Powys County Council’s Finance Panel on Friday, April 28, members looked at the position of last year’s budget as it stood at the end of February, with a month left of the 2022/2023 financial year.

It has been predicted to come the authority will post an underspend of around under £880,000 on its 2022/2023 budget.

The report stated that the Council Tax collection up to the end of February was 94.43 per cent.

The target collection rate was set at 98.5 per cent for the year as part of the Council Tax setting process which happens each November.

Councillor Chris Walsh said: “Inflation is going to be much higher, going through the system for a longer period of time.

“Interest rates for most people are going to be high as well.

“That’s going to put more pressure on the cost of living.”

He asked whether this had been factored into the Council Tax collection rates?

Head of finance, Jane Thomas said: “We review potential collection rates on an annual basis.”

Ms Thomas explained that the collection rates had been “amended” due to the impact of Covid-19 and now because of the cost of living crisis,

Ms Thomas said: “We also have increased money advice with additional officers there to support residents as well.

“During the last year I think we’ve received 9,000 calls to that team to help support with budgeting.

“The service is really valued by the residents.”

Ms Thomas added that national figures on Council Tax collection rates would be published soon and that Powys usually “fares quite well” in those.

“It is something we’re keeping a keen eye on,” said Ms Thomas.

Finance portfolio holder Councillor David Thomas assured the committee that the council is providing help to residents “over and above” the Welsh Government guidance on Council Tax collection.

Cllr Thomas said: “If this cost of living crisis does go on longer than anticipated the problem is going to get larger.”

He feared financial problems could see more people could qualify for the Council Tax reduction scheme which would put pressure on the council’s finances.

Cllr Thomas said that he and the council’s deputy leader Cllr Matthew Dorrance were due to meet with the chief executive of the Citizens Advice Bureaux to go through all the guidelines and procedures that are in place on Council Tax collection.