Pensioners living alone may face increased council tax if a key discount is removed.
- Around 4 million pensioners could lose the 25% single-person council tax discount.
- The potential change could add financial pressure amidst rising living costs and reduced benefits.
- Officials are facing criticism for targeting vulnerable groups with such financial adjustments.
- The proposed changes have sparked concerns among parliamentarians and advocacy groups.
The potential removal of the 25% single-person council tax discount has stirred significant concern among retirees, with approximately four million pensioners potentially impacted. This move follows discussions led by Housing Secretary Angela Rayner, sparking fear amongst those already facing economic challenges.
The current discount provides a reduction of approximately £543 per year on average Band D council tax bills, contributing to a saving of about £3 billion annually for the public purse, according to the Institute for Fiscal Studies (IFS). This substantial financial aid has been crucial for many pensioners who live alone, forming a significant portion of their cost-saving measures amidst rising living costs.
The suggestion to abolish this discount comes as part of broader governmental fiscal strategies, including Chancellor Rachel Reeves’s recent decision to means-test winter fuel payments. This policy change aims to save £1.4 billion but affects the financial wellbeing of nearly 10 million pensioners who previously received up to £300 in winter fuel payments.
Criticism has been pronounced, with Jan Shortt, general secretary of the National Pensioners Convention, denouncing the potential discount removal as an ‘unforgivable betrayal.’ She argues that this could compel some pensioners to sell their homes due to financial strain. Graham Stuart, a Conservative MP, alongside others in the House of Commons, has echoed this sentiment, highlighting the adverse effects on pensioners already losing essential benefits such as winter fuel payments.
Angela Rayner, while addressing the Commons, reassured that there are no current intentions to increase council tax rates. However, her reluctance to guarantee the continuation of the single-person discount has maintained a climate of uncertainty. This hesitation raises concerns, particularly as data from the Ministry of Housing indicates about 8.4 million households benefit from this discount.
As the population ages, the prevalence of single-occupancy households is rising, with notable concentrations in Birmingham and rural areas like Cornwall and Somerset. Caroline Abrahams from Age UK has warned that removing this discount could severely affect older individuals, especially widows, who already struggle with fixed household costs that do not decrease with single occupancy. The government, while not planning immediate reforms, is under scrutiny from pensioner advocacy groups wary of potential fiscal changes.
The looming threat of abolishing the single-person council tax discount amidst economic challenges underscores the vulnerability of pensioners relying on such fiscal relief.
