Council Tax Reduction Scheme: annual report 2023 to 2024

On 1 April 2013, the Council Tax Reduction Scheme (CTRS) replaced Council Tax Benefit (CTB) in Wales and eligible households were automatically transferred onto the new scheme. The CTRS Regulations were closely based on previous CTB rules. This ensured households retained their entitlement to support in meeting their Council Tax liability. We have amended the original Regulations each year since to maintain entitlements. 

We provided local authorities with £244 million for the 2013 to 2014 financial year to enable them to give all eligible households their full entitlement to support. We have maintained these funding arrangements each year since.

This annual report provides an update on the operation of CTRS in Wales from April 2023 to March 2024. This aids transparency in an area where substantial funding continues to be allocated.

• 258,685 households in Wales were in receipt of a Council Tax reduction (CTR) in March 2024, compared to 260,912 in March 2023, a decrease of 2,227 cases (0.9%).
• The estimated total value of reductions provided through the CTRS in Wales in 2023 to 2024 was £301.1 million, compared to £287.2 million in the previous financial year, an increase of £13.9 million (4.6%).
• 101,563 pensioner households in Wales received a CTR in March 2024, compared to 102,526 in March 2023, meaning pensioner caseload has fallen by 963 cases (0.9 %).
• 157,122 working-age households in Wales received a CTR in March 2024, compared to 158,386 in March 2023, a decrease of 1,264 cases (0.8%).
• Of the 258,685 households in Wales in receipt of CTR, 214,434 (82.9%) paid no Council Tax at all.
• In March 2024, 42% of households receiving a CTR were passported cases, whilst 18% were standard non-passported cases. 40% of households receiving a CTR were Universal Credit (UC) recipients.
• 85.1% of households receiving a CTR were living in properties in Bands A to C in March 2024.
• 26 new appeals in relation to CTRS were received by the Valuation Tribunal for Wales from April 2023 to March 2024, compared to 19 during the previous financial year.

In the Spending Review 2010, the UK Government announced its intention to end Council Tax Benefit (CTB). It passed responsibility for developing replacement arrangements to local authorities in England. At the same time, it announced plans to transfer funding to the devolved governments in Wales and Scotland in expectation that they would establish new arrangements. The funding for Council Tax support was transferred from demand-led budgets to fixed budgets and reduced by 10%.

On 1 April 2013, CTRS replaced CTB in Wales. Eligible households were automatically transferred onto the new scheme. The regulations we introduced in 2013 were closely based on the previous CTB rules to maintain entitlements to support. Local authorities were given certain areas of local discretion, allowing each to take the needs and priorities of its local area into account.

£244 million was provided in the local government settlement for CTRS for the 2013 to 2014 financial year. A fixed budget of £222 million was transferred from the UK Government. We provided an additional £22 million to support local authorities in continuing to provide all eligible households with their full entitlement to support. We have continued to maintain these arrangements each year since. We have also continued to maintain full entitlements to support under the scheme. Changes in caseload numbers reflect changes in the numbers of households who apply and meet the criteria for support. 

This annual report provides year-end data for Wales. It includes caseload and the value of reductions from April 2023 to March 2024 based on case management data. It also provides an analysis of the trends and patterns since the CTRS was introduced. All figures relating to the value of reductions have been rounded to the nearest £1,000.

Annex a provides additional statistics for the 2023 to 2024 financial year. 

Data is sourced from a modelling and forecasting tool which extracts detailed information on CTRS cases from the core revenue and benefits systems of Welsh local authorities. Snapshots of CTRS caseload are taken on a monthly basis and the information is used to estimate the total value of reductions for the year. The information provides details of total caseload in March 2024 and the value of awards provided in the financial year from April 2023 to March 2024. Caseload refers to households rather than individuals. In other words, some cases refer to an individual, while other cases refer to a couple or family.

Table 1 shows total caseload in March 2024 was 258,685. This compares with 260,912 in March 2023. The caseload has therefore decreased by 2,227 cases (0.9%).

18 local authorities saw a decrease in total caseload. Gwynedd saw the largest percentage decrease in caseload (4.2%). 

Four local authorities saw an increase in caseload with the largest percentage increase seen in Swansea (2.5%).

Source: Datatank Connect

The value of reduction is the amount by which the Council Tax liability for households receiving a CTR is reduced. Funding is provided to local authorities to replace the Council Tax income they would otherwise raise from eligible households who qualify and apply for support. The effect for eligible households is that they pay a reduced or zero Council Tax bill.

The estimated total value of reductions provided for all households in Wales between April 2023 and March 2024 was £301.1 million, compared to £287.2 million in the previous financial year. This is an increase £13.9 million (4.6%).

All local authorities saw an increase in the value of reductions provided. Swansea and Caerphilly saw the largest increase (7.5%), whilst Gwynedd saw the smallest increase (1%). Table 2 provides figures for the total value of reductions by local authority.

Source: Datatank Connect

The total value of reductions provided will be impacted by annual Council Tax increases in each local authority.

Table 3 provides information about Council Tax rises by local authority for the financial years 2023 to 2024.

 Source: Budget Requirement (BR) returns from local authorities

Table 4 shows that overall, across Wales, 18.3% of households liable for Council Tax were receiving a reduction in March 2024.

This figure varies by local authority. Monmouthshire has the fewest CTR cases relative to all liable households (12.8%), while Blaenau Gwent has the largest caseload relative to all liable households (25.7%).

(a) Source: Council Tax Dwellings (CT1) returns from local authorities
(b) Source: Datatank Connect

As well as overall caseload and reduction figures, the modelling and forecasting tool also provides summary information on the various characteristics of households receiving a CTR.

Overall caseload

Figure 1 illustrates the trend of the caseload since the introduction of CTRS in April 2013. 

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Between April 2013 and the start of April 2020, the caseload had fallen by more than 50,000. The impact of the pandemic saw this trend reverse temporarily during the first lockdown period and by August 2020 levels had increased to 285,553, the highest since November 2017. The caseload began to decrease when the pandemic restrictions eased and in March 2024, total caseload was 258,685. This represents a decrease of 20% compared to May 2013.  Table 5 shows the decrease by working age and pension age households.

Since 2013 the overall pensioner household caseload across Wales has reduced by 25% which may in part be due to changes in the state pension age for both men and women. This was increased to 66 for both men and women in October 2020. There may also have been a decline in the proportion of pensioners who go on to receive a CTR for other reasons. This could, for example, include new pensioners with higher incomes who are more likely to be owner-occupiers and less likely to apply for a reduction. 

Table A1 in annex a provides the monthly live-caseload figures for the period from April 2023 to March 2024 by local authority. This provides a further breakdown by working age and pension age caseloads.

CTRS caseload by age 

Table 6 illustrates the percentage of households receiving a CTR by age-group and local authority. 

• Cardiff’s CTR caseload has the highest proportion of working age households (68.3%) and therefore the lowest proportion of pensioner age households (31.7%).
• Gwynedd’s CTR caseload has the highest proportion of pensioner households (47.8%) and the lowest proportion of working age households (52.2%).

Source: Datatank Connect

Table A2 in annex a provides the actual caseload figures by age group showing the percentage change between March 2023 and March 2024.

There were 157,122 working-age cases in March 2024. This is a decrease of 1,264 cases compared to March 2023 (0.8%). Gwynedd saw the largest decrease (5.7%), whilst Swansea saw the largest increase (3.9%).

There were 101,563 pensioner households receiving a CTR in March 2024 compared to 102,526 in March 2023. This is a 0.9.% decrease. Gwynedd saw the largest decrease (2.6%), whilst Torfaen saw the largest increase (0.8%).

CTRS caseload by value of award

Depending on their circumstances, CTR households in Wales can be entitled to either a full CTR award where their Council Tax liability is reduced to zero, or a partial CTR award where they are still liable to pay part of their Council Tax bill.

In Wales in March 2024, 82.9% (214,434) of CTR households received a full CTR award and were not liable to pay any Council Tax. Across local authorities this ranged from 76% of CTR households in Monmouthshire to 87.6% of CTR households in Newport.

Source: Datatank Connect

CTRS caseload by assessment status

If a household receives Income Support, Income Based Job‑Seekers Allowance (JSA), Income Based Employment and Support Allowance (ESA) or Pension Credit (Guarantee Credit), they are referred to as a ‘passported case’. This is because they will be entitled to 100% support (less any relevant deductions) when assessed for a CTR.

If a household does not receive any of these benefits, or is receiving Universal Credit (UC), they are referred to as a ‘non‑passported case’.

Figure 2 illustrates the proportion of CTRS households by assessment status since March 2019 and shows:

• Passported cases accounted for 42.1% of the overall CTR caseload in March 2024. This compares to 61% in March 2019.
• Standard non-passported cases accounted for 18.0% of CTR cases in March 2024, compared to 27.2% in March 2019.
• Households who received UC made up 39.9% of the overall CTR caseload in March 2024 compared to 11.7% in 2019.

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As the rollout of UC continues, the proportion of passported and standard non‑passported cases is expected to continue to decrease, while the proportion of UC cases is expected to continue to rise.

Table 8 shows the proportion of CTRS households by status for each local authority in March 2024 and shows:

• In Wrexham almost 46% of CTR households are in receipt of UC, with 35% of cases in receipt of passported benefits.
• In contrast in Gwynedd 45% of CTR households are in receipt of passported benefits with 34% in receipt of UC. 

 Source: Datatank Connect

Caseload changes by income status

Figure 3 shows caseload change by income status between March 2019 and March 2024. It shows: 

• Passported cases (JSA, ESA, Income Support and Pension Credit) have decreased by 61,507 since 2019. 
• There has been a decrease in the number of standard non-passported cases by 29,430 (39%). 
• In contrast, the number of Universal Credit cases in March 2024 was 103,193, compared to 32,773 in March 2019, an increase of 215%.

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The most common passporting benefits were ESA and Pension Credit which accounted for 40% of all CTR cases across Wales.

Table A3 in annex a provides the actual caseload figures by income status and local authority for March 2024.

The impact of Universal Credit on the CTRS

By December 2024, Universal Credit is expected to have replaced the following six working-age means-tested benefits: Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Housing Benefit, Child Tax Credit and Working Tax Credit.

Households in receipt of Universal Credit need to apply separately for a CTR. This is in contrast to those who might previously have been assessed for CTR as part of receiving their passporting benefits. In these instances, there was no requirement for eligible households to be proactive in terms of applying for a CTR.

There is anecdotal evidence to suggest this change of approach is affecting the overall caseload for CTRS in Wales, as households who are migrated across to Universal Credit drop out of the CTRS system due to lack of awareness of the new approach. Universal Credit also has an impact on the eligibility of households for a CTR, for example if a household has a higher income under Universal Credit than it would have previously, it may become eligible for a reduced CTR or fall outside the income criteria for a CTR.

We commissioned a detailed assessment of the impact of Universal Credit on CTRS in Wales and the Final Report by Policy in Practice was published in July 2020.

The conclusions show Universal Credit is a significant change in welfare support for low‑income households. The report provides evidence that the move to Universal Credit is having an impact on household resilience and debt levels of low‑income residents in Wales.

CTRS caseload by family type

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• The largest category is single adult households with no dependants. These households (163,142) accounted for 63.1% of the total cases in March 2024.
• The number of single parent household recipients (45,727) accounted for 17.7% of the total cases in March 2024. 
• The number of households comprising a couple with no dependants, 34,085, accounted for 13.2% of the total cases in March 2024.
• The number of households made up of a couple and dependent children, 15,731 in March 2024, accounted for 6.1% of the total cases.

Table A4 in annex a provides the actual caseload figures by family type and local authority for March 2024.

CTRS caseload by Council Tax band

Each chargeable dwelling is placed in a Council Tax band depending on the market value of the property on 1 April 2003. Band A properties are liable for the lowest rates of Council Tax and Band I properties attract the highest rates (Band A- reflects a reduced rate for properties adapted for disabled people).

In Wales, 85.1% of households receiving a CTR were living in properties in Bands A- to C in March 2024. This can be attributed in part to the general spread of dwellings across Council Tax bands in Wales, with almost three-quarters of all chargeable dwellings in Wales being in Bands A to D.

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Table 9 indicates the percentage of each local authority’s overall caseload by Council Tax bands A to C, D and E to I and shows:

• in Blaenau Gwent 98.1% of CTR households were in bands A to C properties, with just 53 households (0.6%) in bands E to I
• in contrast in Monmouthshire 61.7% of CTR households were in bands A to C properties, with 15% in bands E to I

Source: Datatank Connect

Figure 6 shows the proportion of all chargeable dwellings in receipt of CTR by Council Tax band. Band A has the highest proportion of dwellings in receipt of CTR at 40.6%. Bands E to I have the lowest proportion of dwellings in receipt of CTR at 4.2%.

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Table A5 in annex a provides the proportion of households receiving CTR by local authority and council tax band in March 2024.

Under the CTRS Regulations, each local authority in Wales must adopt its own scheme for the following financial year by 31 January. These schemes, based on the national requirements, include areas of local discretion to enable authorities to take the needs and priorities of their local area into account. All authorities have adopted schemes, though if any fail to do so, the default national scheme would be imposed to ensure eligible households continue to receive financial assistance in meeting their Council Tax liability.

The areas of local discretion where a local authority can choose to implement provisions which are more generous than the minimum requirements set out in the regulations are:

• Extended reduction period: local authorities may increase the period during which eligible households are entitled to continue to receive a reduction in certain circumstances, beyond the standard 4 week period.
• Backdating of applications: local authorities are able to backdate applications for reductions beyond the standard 3 month period.
• War Disablement Pensions and War Widow's Pensions: local authorities are able to disregard more than the statutorily prescribed £10 of the money received in respect of these pensions when calculating income.

Details of each local authority's scheme can be found on individual local authority websites.

Valuation Tribunal for Wales 

Since the introduction of CTRS on 1 April 2013, the Valuation Tribunal for Wales (VTW) has been responsible for hearing appeals arising from CTRS decisions. Individual Council Taxpayers are able to register an appeal only after they have raised a complaint directly with their local authority.

Table 6 shows the outcome of CTRS appeals received by the VTW in the financial year from April 2023 to March 2024. There were 26 appeals received and 23 were brought forward from the previous financial year.

11 cases were settled before the tribunal panel hearing. Usually, the outcome of such cases is in favour of the appellant because an authority has reconsidered its initial decision following the receipt of additional evidence in relation to the appellant’s claim. At the end of March 2024, 21 cases remained outstanding.