Local authorities in England referred at least 280,000 households to bailiffs for the council’s tax debt in the first year of the pandemic, and called for the benefits of more than 115,000 people to be deducted to clear their arrears, the Observer can reveal.
The councils took very different approaches to municipal tax arrears when the economy froze and unemployment rose during 2020-21, with some councils suspending all debt recovery actions while others continued to haunt thousands of households.
Figures obtained under the Freedom of Information Act show that councils passed 281,380 households to sheriffs in 2020-21, with at least 93,031 cases related to municipal tax arrears accumulating over the course of that year, rather than years. previous.
Sheriffs can visit people’s homes to try to collect money and even take their belongings if they are collecting an unpaid debt, although such action was suspended for the first five months of the pandemic.
City councils requested “benefit schedules” for 117,492 municipal taxpayers, deducting money from benefits to offset municipal tax arrears. The figures cover about two-thirds of England’s ‘lower level’ district or township councils.
Anela Anwar, executive director of anti-poverty charity Z2K, said: “These statistics reveal the devastating impact that municipal tax debts have on hundreds of thousands of people. The default position for many councils seems to be to recover the debt for benefits rather than negotiating with the person to agree on an affordable repayment plan.
“On top of that, the zip code lottery of municipal tax reduction schemes, combined with punitive recovery powers, means that thousands of people end up in a debt pit that is impossible to get out of. We urge this government to reestablish a fully funded national system of municipal fiscal support, which will help protect families caught in the grip of poverty. “
Municipal tax bills have risen dramatically in recent years, and the government has allowed city councils to raise rates by as much as 5% annually to fill some of the gaps created by austerity, particularly in adult care services.
This, together with the economic crisis caused by the pandemic, led people to go into debt with municipal taxes. An investigation published by Citizens Advice in January estimated that more than 3.5 million people were behind in paying municipal taxes, of which just over half were not behind at the start of the pandemic.
Franklyn Jaffier, who lives in West London, learned that his universal credit payments were cut last summer by around £ 20 a month to pay for municipal tax arrears dating back to 2019, as well as £ 58 to month to pay off a universal credit advance loan. .
Your payments are also subject to the benefit cap, and last winter your benefit was suspended entirely for three months because you had allegedly been overpaid your disability benefit by £ 300, just one week after your benefit payments began for disability. He now lives, after paying the rent, on about 230 pounds a month, which is less than 60 pounds a week.
“I am really struggling,” he told the Observer. The Camden council’s digital inclusion project gave him a Chromebook so he could take an online course on data analytics, but he had to pawn it in exchange for a loan.
“This is the level of homelessness that I have to try to live without jumping off a bridge. I am not a person who has been used to being in the benefits system that way, I have always worked. What I’m seeing here is a complete nightmare about how the system works against people. “
Bradford requested the most benefit riders in 2020-21: 10,417 benefit applicants, all related to pre-pandemic debt.
A spokesperson said the Bradford council granted all low-income families a city tax exemption for three months during the pandemic, with no collection activity for taxpayers during that time. Low-income families also received £ 100 awarded against their tax bills. “When we came out of the first lockdown we had to catch up with our collection activity and, like other authorities, we issued a series of embargo requests to those who had arrears since before the pandemic began,” said the spokesman.
Reflecting the dilemma faced by cash-strapped municipalities, overall municipal tax arrears in England increased by almost a quarter in 2020-21.
George is Digismak’s reported cum editor with 13 years of experience in Journalism