Unemployed residents face postcode lottery over council tax benefit payments

New rules will allow councils to set the criteria for eligiblity

Unemployed residents in receipt of council tax benefit will be subjected to a postcode lottery of how much they will be entitled to in the future, it has been revealed.

Brent Council currently pays out about �35million each year in the benefit, which it claims back from central government.

But from April 2013, the government could ask each local authority to take responsibility for the benefits and will only give it 90 per cent of what it currently funds.

If the same number of people were to continue claiming council tax benefit, then the council would have to cut �3.5m from other services.

But the number is rising each year, which could add a further �1m - �2m to the bill by 2013/14 – making a shortfall of up to �5.5m.

If the council decides not to make these cuts, it will be forced to stop paying out council tax benefits to people in the borough.

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Clive Heaphy, director of finance and corporate services at the council told the Times: “Brent is one of the most affected boroughs. Our average income is low within London, meaning the number of claimants is high.

“Brent will have some really difficult choices. Either keep the same scheme and cut back on other council services, or change the scheme to a less generous one for working age people who are not in work.

“The government plans to protect pensioners. It also requires us to support the ‘it pays to work’ principle and protect anyone working.

“This means it would need to be taken from the benefits of those not in work – clearly more vulnerable groups.”

There are around 36,000 claimants in Brent, of whom around 12,000 are pensioners and 24,000 are of working age.

The reform coincides with the introduction of housing benefit changes which will limit the amount residents can claim.

It could also lead to more than 400 different housing benefit schemes across the country, resulting in a postcode lottery depending on where you live.