CONGRATULATIONS to @haringeycouncil and @HaringeyLabour for returning #counciltax reduction scheme to 100% for 3000 families claiming shredded DWP benefits & reducing CTRS for 3000 more in April 2019

3 April 2019


“Empathy, responsibility and courage” can change policies that are damaging the poorest families and individuals. (after George Lakoff author of “The Political Mind”)

From 1 April 2019, Haringey Council will stop collecting council tax from 3,000 of the borough’s poorest families and reduce the tax of 3,000 more families claiming shredded benefits from the jobcentres. The new policy will extend to single adults in the same circumstances in April 2020. That is a brave and fair thing to do in the midst of dire cuts to local authorities’ funding from central government. It is generally acknowledged locally that the change had much to do with a six-year campaign by the Reverend Paul Nicolson, founder of Taxpayers Against Poverty. This is his account of that campaign: 

I founded the Zacchaus 2000 Trust in the 1990s, along with a small group of volunteers who shared my deep concerned about the impact of the Thatcher government’s ‘poll tax’. As the vicar of Turville, in Buckinghamshire, the home of the Vicar of Dibley, I was asked by the single black father of three young boys to baptise them. Two days before the service, he phoned to say he couldn’t bring them to church after all, because the boys had no proper clothes. They had been told off at school for not having a PE kit, which he could not afford because he owed £1,200 in poll tax. We bought them their school clothes and baptised the boys. 

I was taught by Adam Murdey, a barrister, how to be a McKenzie Friend [a unqualified person who accompanies another in court to offer moral support, take notes and offer quiet advice and may speak with the permission of the court] and I represented the father, a benefit claimant, in that capacity in High Wycombe Magistrates Court. I put together the relevant facts, in line with the Wednesbury Principles (A decision is deemed ‘Wednesbury unreasonable’ or irrational if it is so unreasonable that no reasonable person acting reasonably could have made it]. The magistrates cancelled the demand for £1,200. 

A decade or so later, the poll tax having been replaced by the council tax, I lobbied Parliament against the Local Government Finance Act 2012. It abolished the council-tax benefit. The burden of taxing poor households was thereafter shifted to local government. The benefit was given a new name: the council-tax reduction scheme. The central government grant was cut by 10%, and 277 out of 326 councils now ask the poorest benefit claimants to make up the shortfall in government grant from their meagre benefit income. That is grossly unfair. 

The current adult Jobseekers’ Allowance of £73.10 a week equates to Universal Credit of £317 a month. This has to fund 20% to 30% of a council-tax bill as well as cover more rent than before because of the additional cuts to housing benefit – and that is the case even when a claimant has had their income stopped altogether, normally for up to three months, by a jobcentre benefit sanction. If a council-tax bill is not paid, a council will – after receiving a liability order from the magistrates plus costs – send in the bailiffs. Bailiffs charge £75 for administrative costs, £235 for each visit made to a debtor’s home and £110 if they are required to collect belongings to sell by auction. 


The first step in our campaign to persuade Haringey Council not to tax its poorest residents was to challenge the process by which it took the decision to do so. It became apparent that the council had made the decision to tax the poorest residents before embarking on a mandatory consultation. We began litigation. Ian Wise QC, who had overturned more than 1,000 cases of imprisonment for non-payment of the poll tax, took on the case. Michelle Moseley, a brave single mother on a low income, applied for legal aid. Ian Wise, together with Alex Rook of Irwin Mitchell, saw the case through to a win in the Supreme Court. That judgment, was the court’s first case about consultation. The five judges affirmed that the Sedley Principles in Moseley v Haringey – one of which is ‘consult before deciding’ – would apply to all future consultations by local or national government. In failing to consult before deciding, Haringey had been unlawful. Nonetheless, the council was not asked by the supreme court to consult again, so the taxing of the poorest began again. 


From April 2013, I refused to pay my council tax. I was inevitably summoned to Tottenham Magistrates Court. Haringey Council’s court costs, which are added to the arrears of the poorest citizens of which I was not one, were £125. I asked the magistrate and the council for a breakdown of those costs, which they refused. I therefore took them both to the High Court, with the pro bono help of Helen Mountfield QC and Eloise le Santo of Matrix Chambers. Unsurprisingly, the presiding judge, The Hon Mrs Justice Andrews OBE, ordered them to show me the breakdown. 


The further I went into Haringey’s court costs, the more it became clear that they were seen as a revenue earner, despite the regulations that require that they pertain to the actual costs of taking a case to court. The regulations require a council to charge the costs of the summons and then add the costs of the liability order awarded against the council tax debtors by the magistrates court. Haringey was the only council I could find unlawfully charging £125 for the summons but no more for their 20,000 lability orders a year.  An objection to Haringey’s 2013/14 accounts raised with Grant Thornton, their external auditor, showed this to be true. He made Haringey split the £125 into £102 for the summons and £115 for the liability order. The council had been overcharging residents who paid off their arrears on receipt of their summons for a court hearing they did not attend, as well as those 20,000 residents it has taken to court every year since 2010, when charging as much as possible became its policy. 


The bailiffs can break in to your home to enforce a criminal fine but cannot break in to enforce council tax arrears which are a civil debt. I kept my doors shut. The council had given my mobile number to the bailiffs who bombarded me with intimidating text messages up to 8pm over several days. I thought of the single mothers on jobcentre benefits unaware that they are allowed to keep their doors shut.  


I thought then, and still do, that Grant Thornton ought to have exercised its legal discretion to write a report in the public interest about Haringey overcharging 20,000 residents a year. However, it appeared that transparency was very far from the company’s thoughts. I only learnt that the council had agreed with the magistrates at an unannounced public hearing that there should be a reduction and splitting of the costs when I was helping someone in council-tax arrears and saw the reduced cost recorded on her court summons.  

Another serious issue remains unresolved. Exactly to whom is the external auditor of a local authority accountable? The public or the councils? The councils pay the auditors enormous fees. I pursued that issue all the way to the High Court, too. Grant Thornton and Haringey Council made my point by teaming up against this member of the public. Lord Justice Hamblen agreed with them, handing down £50,000 costs against me. I turned the costs into an Individual Voluntary Arrangement to avoid bankruptcy. My payment of a proportion of the costs comes to an end in November of this year.  


The Audit Commission was a statutory corporation. They appointed auditors to a range of local public bodies in England, set the standards for auditors and oversaw their work. It was abolished in 2015, its functions being transferred to the voluntary, not-for-profit or private sector. The Institute of Chartered Accountants in England and Wales (ICAEW) has a Royal Charter, awarded by Queen Victoria in 1890. It is responsible for the standards of accountants and has a code of ethics. It, too, was not impressed with my thoughts about auditors being responsible to the public. I kept Prem Sikka, Professor of Accounting at the University of Sheffield, informed. He wrote of the way they handled my complaint: ‘It is rare for any complaint against ICAEW members to succeed and there is no way of knowing how the personnel selected by it filter or weigh the evidence. It does not owe a “duty of care” to the public. It is a law unto itself. It has a reviewer of complaints and he is selected and paid by the ICAEW. Its code of ethics is just a fig leaf. ICAEW’s regulatory status needs to be removed and it should be replaced by robust and independent bodies.’ 


Haringey Council has now wonderfully redeemed itself after becoming careless in its interpretation of the law, never believing it would be challenged. And does all of this really matter? Yes, it does, when seen in the context of austerity, poverty, increasing homelessness, related mental and physical illness, an unprecedented increase in infant deaths and a shortening of life expectancy. The next time a politician boasts about lifting millions out of income tax spare a thought for the millions of impoverished UK citizens claiming benefits, who are in a vice of draconian enforcement of an Increasing council tax being screwed ever tighter by the State, which is decreasing their income while increasing their rent.  

UNFINISHED BUSINESS  Exactly to whom is the external auditor of a local authority accountable? The public or the councils?