Figures released by the Department for Levelling Up, Housing and Communities (DLUHC) reveal that outstanding council tax arrears have surged to £6bn as of 31st March 2024, marking a 9% year-on-year increase and a staggering 71% rise since pre-pandemic levels. In the 2019 to 2020 period, total outstanding arrears were £3.5bn.
Concurrently, the average amount of council tax arrears per StepChange client has climbed by over 50%, from £1,146 in 2019 to £1,726 in 2023.
Amid these rising arrears, StepChange Debt Charity has voiced concerns about the outdated and harmful debt collection practices used by local authorities. These practices often include charging households the full yearly council tax bill in a single payment, swiftly appointing bailiffs to collect debts, and in extremely rare cases, imprisoning individuals for up to three months.
StepChange reports that around a third of their clients are in council tax arrears. The charity highlights that the most financially vulnerable are often those who struggle to keep up with these bills and calls for councils and the Government to adopt a less punitive approach to collecting council tax debt, offering more support to those in financial difficulty.
Recent research by StepChange, conducted through YouGov, indicates strong public support for a fairer system:
- 69% of respondents support stopping councils from using bailiffs to recover council tax debts from vulnerable individuals.
- 69% back reducing council tax rates for the lowest-income households, funded by the Government.
- 84% support the introduction of an independent statutory regulator to ensure bailiffs treat debtors fairly.
- 82% oppose the existing regulation that requires households to pay their annual council tax bill in full if they miss one month’s payment.
StepChange is urging the next Government to regulate the bailiff industry effectively, advocating for the Enforcement Conduct Board to receive statutory backing. This would aim to protect the most vulnerable, eliminate bad practices, and improve industry standards.
Richard Lane, chief client officer at StepChange Debt Charity, said: “It is unsurprising that council tax arrears have risen as many local authorities have increased their rates by up to 5% to cover rising costs and obligations. Over the past few years, we’ve seen a rise in the number of people seeking help from StepChange who are struggling to keep up with essential bills like council tax, as inflationary increases prove unaffordable for those on lower incomes.
“Due to current council tax collection practices, these increases may mean more households face bailiff action as local authorities look to recoup unpaid debts. Our insights and research have consistently shown that bailiff action can cause increased harm to those in vulnerable positions and can make existing debt problems worse. That’s why we are calling on all parties and the next Government to introduce a statutory regulator for the industry, one which drives up standards and stamps out poor practice.”
