Local authorities given strategy for fairer approach to council tax

The Money Advice Service will help councils boost the number of positive outcomes for residents while reducing debt collector involvement

Guidance on council tax recovery that is fairer and more progressive has been released by the Money Advice Service (MAS).

The strategic direction is aimed at local authorities, who it is hoped will take a more compassionate approach to collecting council tax, while making the payment of tax arrears more sustainable.

The toolkit is modelled on best practice examples from councils across England and Wales, 10 of which have already adopted the model. It will promote greater collaboration between local authorites and the debt advice sector in an effort to maximise positive outcomes for residents.

Among the councils which already adhere to the MAS guidance, it was observed that a higher percentage of the money owed was collected than in similar circumstances elsewhere.

Councils have been given an eight-step strategy according to the MAS’s findings, including  helping residents access independent debt advice, retaining oversight of debt advice and recovery partners and putting a focus on affordability for residents in all proceedings.


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Caroline Siarkiewicz, Head of Debt Advice from the MAS, said: “We are delighted to launch this resource as part of our ongoing commitment to enable more consistent creditor support for people in financial difficulty. This guidance is a timely intervention.

“We hope to shine a light on good practices that can be adopted across all councils to ensure more take a progressive approach that supports residents and helps them to maintain ongoing commitments.”

The MAS found that over a third of the 8.3 million people looking for debt advice had missed council tax payments – and those numbers are on the up. This then contributed to closer involvement of debt enforcement agents.

Earlier this year The Big Issue reported on families trapped in poverty despite working full-time on the national living wage – council tax being one of the debts quickest to mount up – and how this can lead to homelessness.

Yvonne Fovargue MP, chair of the All-Party Parliamentary Group on Debt and Personal Finance, said: “Some debt collection practices, particularly the use of bailiffs, make matters worse not better.”

The amount of council tax arrears is calculated at £2.84bn.

Citizens Advice, who have welcomed the new guidance, said that in the last four years more people have sought their help over ‘living debt’ – for example council tax, utilities, rent and child care costs – than over consumer credit issues.

Councillor Richard Watts, chair of the Local Government Association’s resources board, said: “Councils have a duty to their residents to collect taxes, so that important services can be delivered for local people. However, councils do realise that times are tough and do their best to protect those affected the most.

Earlier this year, Treasury Select Committee MPs said current debt collection practices were “overzealous and with routine recourse to bailiffs”.

Citizens Advice CEO Gillian Guy said: “Council tax arrears are the most common debt issue we help people with at Citizens Advice. Too often we see the harm that’s caused by the way this debt is collected, including further financial hardship and stress.

“By helping those who are struggling to meet their payments, councils can improve their collection rates. While voluntary approaches are welcome, to properly protect people from bad practices the government needs to establish an independent bailiff regulator.”