Local councils in England are still contending with a staggering £6.6 billion of outstanding council tax. While the total arrears in the past year have increased more than sixfold. The situation has prompted concerns about the financial burden on low-income families, with many struggling to meet their obligations amid rising living costs.
In just the last year up to April, council tax arrears increased by £642 million just in England. That’s a 7.2% increase over last year, which shows just how much pressure is mounting on family budgets. Over the same period, councils in England raised £41.2 billion in council tax. While their monthly payments have not risen, the total amount they owe has shot up by 11%.
The projected fiscal stress extends well outside of England. Outside England, Scotland has recently recorded £1.5 billion of unpaid council tax, while Wales has built up £263 million. The total debt across just England, Scotland and Wales has now surpassed £8 billion. Not to be overshadowed by this large sum, equally alarming is the deepening poverty that those directly impacted are living in.
This is partly because people in council tax arrears are mostly from low-income households, with most under the poverty line. Toby Murray from the charity Debt Justice highlights this concerning trend, stating, “People in council tax arrears are overwhelmingly on low incomes, and many are living in poverty.”
The implications of these arrears are significant. In England, miss your council tax payment by three weeks or accumulate three late payments, and your local authorities will pursue you. They can require that you purchase the full-year cost all at once. At a time when many households are just making ends meet, this policy places additional stress with the risk of court action looming.
Charity groups have campaigned for years against the way council tax is collected. They claim that such practices disproportionately punish people who are truly unable to pay. Murray further asserts that “rather than help, councils are sending in the bailiffs – punishing people for struggling with their bills. Local authorities should be prohibited from employing bailiffs to enforce council tax arrears. Instead, it’s time to start implementing some much-needed reforms in a hurry.
In light of these concerns, the government has pledged to introduce a fee cap for court action against debtors. They will roll back restrictions on when a household is deemed to be fully responsible for a year’s worth of bills. These measures will help relieve some of the burden on vulnerable households.
Debt Justice has suggested an alternative amendment. Secondly, they plan to make spreading council tax payments over 12 months the norm, rather than the usual practice of paying this bill over 10 months. This smart change will make it easier for families to coordinate their payments to fit their schedules. In addition, it can reduce the share of households behind on their bills.
The total outstanding council tax arrears have hit a new all-time high. They are now twice as high as all unpaid energy bills in England, Wales and Scotland combined. This overwhelming reality demands immediate action from our federal government to ensure that low-income Americans do not face additional financial distress.
Plans to reform council tax collection methods are still under discussion, and yet families continue to suffer. They have an uphill battle to wage against climbing debts. A spokesman emphasized the urgency of addressing this issue: “Otherwise, it is almost inevitable that bills will continue to be forced up for those who can least afford to pay.”
