The full Agenda report and appendices associated with this recommendation were circulated to all Members with the agenda for the meeting of Corporate Management Committee and are available on the website.

The Committee considered a report advising them of the implications associated with any changes to the Council’s current policy on Council tax discount for empty dwellings and the Council tax premium for dwellings that were empty for a long period of time.  Local authorities had been given powers to amend the time period for Council Tax discount for empty dwellings (which were defined in the legislation as unoccupied and substantially unfurnished dwellings), and to increase the Council Tax premiums for longer term empty dwellings.

Currently the Council gave a 100% Council Tax discount for empty dwellings for up to 3 months and increased the additional amount payable (or premium) for Council Tax by 50% for dwellings empty for more than 2 years.  If it chose to do so, the Council was able to reduce the time period for the 100% discount for empty dwellings from up to 3 months to up to 28 days and to increase the premium for Council Tax for dwellings empty for more than 2 years from 50% to 100%, for dwellings empty for more than 5 years from 50% to 200% and for dwellings empty for more than ten years from 50% to 300%.  The Committee noted the consequences which would result from making these changes and considered whether or not to recommend to Full Council that they be made. 

At its meeting on 15 July 2021, Full Council had considered a Motion from Councillor D Whyte seeking the support of Full Council to fully enact Empty Dwelling Council Tax premiums from April 2022 to encourage empty dwellings in Runnymede to be brought back into use as legislated by the Government. This Motion had been lost and the Leader of the Council had stated that a report would be submitted to the Corporate Management Committee as part of the Medium-Term Financial Strategy (MTFS). As decisions on these issues were related to Council Tax rather than to the MTFS, the report was submitted to the Committee for it to make a recommendation to the Council Tax setting meeting of Full Council which would be held on 10 February 2022.

The Committee noted the policies of the other Surrey local authorities on this discount and on these premiums. Runnymede was the only Surrey authority that granted a 100% discount for up to 3 months.  Most of them had reduced the discount period to 28 days or 1 month.  Several Surrey authorities had applied Council Tax premiums of 100%, 200% and 300% to dwellings that had been empty for more than 2, 5 and 10 years respectively.

The estimated potential additional Council Tax raised by reducing the discount period from 3 months to 28 days was £87,662 and Runnymede’s share of this sum would be £7,889.  The estimated potential empty homes premium raised by increasing premiums at 2, 5 and 10 years by the percentages referred to above would be £317,785 and Runnymede’s share of this sum would be £28,600.

Surrey County Council had indicated that it would be willing to reallocate its share of the Council tax premium funding (estimated at approximately £245,000) that would potentially directly result from changes in empty homes premium policies.  This reimbursement would be available to fund new or extend existing initiatives and projects that directly supported a County initiative or specific project. However, it was noted that Runnymede would not derive benefit from this offer by Surrey County Council until 2023/24 and that the offer would only last for two years. Surrey County Council would require an audit of the sums that had been collected which would not be available until June/July of 2023.

The Committee noted that the overall potential approximate cost to the Housing Revenue Account of making these changes in respect of vacant properties would be £37,500 and that the potential cost of these changes to the Council in respect of other current vacant properties could be in the region of £93,000.

Properties left empty by deceased persons were exempt from Council Tax until 6 months after probate had been granted. The Committee noted details of numbers of properties in Runnymede paying Council Tax empty for more than 6 months but less than two years and those paying Council Tax that had been empty for more than 2 years.  The Committee also noted the equality and environmental/sustainability/biodiversity implications in respect of considering a change to the Council Tax discount period and the Council Tax premium payable for empty properties.

A minority of Members of the Committee considered that given the increasing pressures on housing within the Borough, reducing the time period for the 100% discount and introducing the new premiums would provide a greater incentive for owners of empty properties to bring them back into use in a timely manner which would be a positive development. Additional revenue for Runnymede could also result if these changes were made.

However, a majority of Members of the Committee considered that the Council’s policy on the time period for empty dwelling Council Tax discount and on the Council Tax premium for dwellings empty for more than two years should be unchanged for a number of reasons.  The potential additional income which would result from these changes was speculative and uncertain. There would be potential costs to the Council in respect of current vacant properties as outlined above. Tracing persons liable for these additional amounts of Council Tax and obtaining summonses and court orders would be difficult and costs would be incurred by the Council’s officers in pursuing these matters. It would be possible to avoid paying these extra sums quickly and legally.  Making these changes would also have an adverse impact on bereaved families.

Recommend to Full Council on 10 February 2022 that with effect from 1 April 2022 - 

i)       the Council Tax discount for unoccupied and substantially unfurnished dwellings be retained at 100% for up to 3 months (Class C of the Council Tax (Prescribed Classes of Dwellings) (England) (Amendment) Regulations 2012); and

ii)    in accordance with Section 11B of the Local Government Finance Act 1992 and Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018 the additional amount payable for Council Tax for dwellings that are unoccupied and substantially unfurnished for more than two years be retained at 50%.

Council considered a recommendation from the Corporate Management Committee which had met on 20 January 2022 regarding review and Replacement of Runnymede’s Council Tax Discount Scheme for Empty Properties.

Currently the Council gave a 100% Council Tax discount for empty dwellings for up to 3 months and charged an additional amount (or premium) for Council Tax of 50% for dwellings empty for more than 2 years.  If it chose to do so, the Council was able to reduce the time period for the 100% discount for empty dwellings from up to 3 months to up to 28 days and to increase the premium for Council Tax for dwellings empty for more than 2 years from 50% to 100%, for dwellings empty for more than 5 years from 50% to 200% and for dwellings empty for more than ten years from 50% to 300%. 

A minority of Members of the Council considered that given the increasing pressures on housing within the Borough, reducing the time period for the 100% discount and introducing the new premiums would provide a greater incentive for owners of empty properties to bring them back into use in a timely manner which would be a positive development and make more effective use of housing stock. Additional revenue for Runnymede could also result if these changes were made which could potentially be used for services and environmental initiatives. An Amendment for an addition to the Motion was moved and seconded as follows:

.

iii) In accordance with section 11B of the Local Government Finance Act 1992 and Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018 the additional amount payable for Council Tax for dwellings that are unoccupied and substantially unfurnished for more than five and ten years to be increased from 50% to 200% and 300% respectively.

However, a majority of Members considered that the Council’s policy on the time period for empty dwelling Council Tax discount and on the Council Tax premium for dwellings empty for more than two years should be unchanged for a number of reasons.

Members considered the financial implications of the changes on the Council, on other Preceptors who would benefit from any increase in tax (Surrey County Council and the PCC), and on those who might be liable for payment of the increased premiums. Members noted that the potential additional income for the Council should not be considered as the driver for these changes as the primary reason would be to encourage taxpayers to bring empty properties back into use. It was also noted that the income generated could not be accurately quantified due to the anticipated behavioural changes that might occur following the introduction of increased premiums.

It was suggested that other options be explored with Members to work with owners and landlords to encourage the bringing back into use of empty dwellings. Cllr Burton requested that the names of those voting on the Amendment be recorded and the voting was as follows:

For the Amendment (10):       Councillors Burton, Cressey, Gill, Gillham, Harnden, R King, Mullens, S Whyte, D Whyte and Williams.

Against the Amendment (19): Councillors Adams, Balkan, Broadhead, Bromley,

                                                Coen, Cotty, Furey, J Gracey, T Gracey, Heath, Hulley,

                                                N King, Maddox, Nuti, Prescot, Snow, Walsh, Willingale

                                                and Wilson

Abstentions:    0

The Amendment was lost.

The original Motion was then put to the vote and it was-

            Resolved that-

i)       the Council Tax discount for unoccupied and substantially

       unfurnished dwellings be retained at 100% for up to 3 months        (Class C of the Council Tax (Prescribed Classes of Dwellings)        (England) (Amendment) Regulations 2012); and

ii)    in accordance with Section 11B of the Local Government Finance Act                   1992 and Rating (Property in Common Occupation) and Council Tax                   (Empty Dwellings) Act 2018 the additional amount payable for

Council Tax for dwellings that are unoccupied and substantially unfurnished for more than two years be retained at 50%.