Item 5 on our agenda is the Council Tax Reduction Schemes (Prescribed Requirements and Default Scheme) (Wales) (Amendment) Regulations 2018. I think you need more time for this if you're going to have to keep repeating that. So, I call on the Cabinet Secretary for Finance to move that motion. Mark Drakeford.

NDM6618 Julie James

To propose that the National Assembly for Wales; in accordance with Standing Order 27.5:

Approves that the draft The Council Tax Reduction Schemes (Prescribed Requirements and Default Scheme) (Wales) (Amendment) Regulations 2018 is made in accordance with the draft laid in the Table Office on 27 November 2017.

Motion moved.

Thank you very much, Deputy Presiding Officer, and thank you for the opportunity to bring forward these amendment regulations today.

I’d like to thank the Constitutional and Legislative Affairs Committee for its report on the regulations. The regulations before the Assembly this afternoon amend the council tax reduction scheme regulations of 2013. The UK Government actually scrapped council tax benefit from 1 April 2013 onwards, and passed the responsibility for developing new arrangements to the Welsh Government. They also made a 10 per cent cut to the budget for this programme. The Welsh Government responded by providing funding to enable some 300,000 less wealthy households in Wales to continue to have the right to support. This amendment regulation is needed to ensure that the figures used to count the right of each household to a reduction in council tax are increased to take into account the fact that living costs have increased.

In slightly more detail, Dirprwy Lywydd, in the regulations in front of the Assembly this afternoon, the financial figures relating to working-age people, disabled people and carers for 2018-19 are increased in line with the consumer price index, that is to say, by 3 per cent. This contrasts with the UK Government's policy of freezing working-age benefits until 2019-20. Figures relating to pensioner households in the regulations are proposed to be increased in line with the UK Government's standard minimum income guarantee and mirror the uprating of housing benefit. The UK Government has introduced new restrictions on housing benefit for families with two or more children, and a child born on or after 1 April 2017. This is in addition to restrictions introduced from April 2016, which remove the family premium for new births and new claims for housing benefit. I do not propose to adopt these changes in respect of council tax reductions in Wales. The Welsh Government is committed to protecting families on low incomes who have been affected by welfare reforms from further cuts in their income.

In making these regulations, the opportunity has also been included to include minor technical changes and to make additional amendments to reflect other changes to related benefits and welfare payments. For example, from April 2018, there are a number of additional funds and payments that, if these regulations are approved, will be disregarded for the purposes of calculating council tax reductions. These include the new bereavement support payments, the infected blood scheme, and the thalidomide health grant amongst others. Recipients of such assistance in Wales will not be disadvantaged in obtaining help with their council tax.

These regulations, Dirprwy Lywydd, therefore maintain the entitlements to reductions in council tax bills for households in Wales. Provision of £244 million have been made in the budget for 2018-19 for these purposes. As a result of the scheme, some 220,000 of the most hard-pressed households in Wales will continue to pay no council tax in 2018-19. I know that the scheme has been strongly supported by Members in different parts of this Chamber since it was introduced in 2013, and I hope that this support will extend to approval of the regulations before you this afternoon.

Thank you. Can I call on the Chair of the Constitutional and Legislative Affairs Committee, Mick Antoniw?

Thank you for that. The Constitutional and Legislative Affairs Committee considered this instrument at our meeting on 11 December. We reported one merits point identified under Standing Order 21.3. This particular piece of legislation is very complex and technical when read alone. The explanatory memorandum accompanying these regulations uses everyday language to explain the technical changes being made and it really helps the reader to make sense of the legislation. The committee appreciated this helpful approach, given how complex the legislation is, and, as Chair of the committee, on behalf of the committee, I know you'll be overjoyed and enthused to know that it was the view of the committee to commend the Welsh Government on this example of good practice.

The council tax reduction schemes are vital to the most vulnerable people in Wales and this is a scheme that allows many people to receive a reduction and it exists, to an extent, because the council tax is not progressive enough. So, I’d like to ask, first of all, whether the Government has an intention to look at a fairer taxation system so that we won’t need a council tax reduction scheme that’s as wide ranging as the one that we have at present in future.

You’ll remember that it’s Plaid Cymru that compelled the previous Government to take responsibility for this scheme, leading to the passing of the regulations in 2013, and following that the Welsh Government has been meeting the deficit, on an annual basis, for the scheme, by ensuring that £0.25 million is available for the scheme within the local government settlement every year since 2013-14. Truth be told, the fund that is available, if it continues at the same level, and I think you just said that it will be, that means that it’s less in real terms than it was four years ago. As far as I can see, the new figures mean an increase in what the residents are going to receive in support to meet inflation costs and an increase in the cost of living. So, how is that going to be paid for? Will there be a corresponding increase in the size of the fund? You’ve said now that there won’t be. Does it mean that there will be some residents who will receive more as a result of inflation and so on, while others will be left out entirely from the scheme, because of changes to the welfare system? Or, indeed, are you expecting the local authorities to find the funds from their budgets, which are getting scarcer?

So, I would like you to confirm how much funding is available, because if it’s the same figure that’s available, then there’s a danger that some of the most vulnerable people in Wales will suffer. I do understand that there is an impact assessment that has been undertaken to the likely costs of complying with these regulations. I haven’t had a chance to look at that, or to pursue that. Could you tell us what the result of the assessment was? I’m sure that you can understand that we need to have all of the information before we can support these regulations. Thank you.

Thank you. Can I call on the Cabinet Secretary for Finance to reply to the debate? Mark.

Thank you, Dirprwy Lywydd, and thanks to Mick Antoniw for the work of the Constitutional and Legislative Affairs Committee in scrutinising these regulations. I'll certainly report what he had to say to those who helped to prepare the explanatory material that went alongside it. I know they work very hard to try to turn some complex and technically challenging material into an account that can be understood by people who have to operate them in local authorities, and those who have a general interest in the way in which support for families in these circumstances can be provided.

May I tell Siân Gwenllian that I recognise the support provided by Plaid Cymru when the original scheme was being prepared back in 2013, and I also acknowledge the support that we’ve received from Plaid Cymru over the years in maintaining the scheme and keeping it going, year on year?

Of course, the points that Siân Gwenllian raises are important, and matter to me as finance Minister. What has happened in the last 12 months, Dirprwy Lywydd, is that the number of households who are claiming council tax benefit has gone down. This is associated with the rise in employment levels in parts of Wales over the last 12 months, and that has the effect of allowing us to sustain the scheme in full and to make it slightly more generous in some aspects next year, so that the qualifying criteria for the scheme next year will not have been narrowed at all, and that we can continue, we think, to meet the costs of that from the budget that we were able to provide in this financial year. That's £244 million of Welsh Government money, topped up, it is true, as Siân said, by a contribution—from memory, Dirprwy Lywydd—of around £12 million by local authorities themselves. We don't expect their contribution to have to rise next year either.

But, should conditions in the economy change, should there be an upturn in the number of people needing help from the scheme, then of course, in bringing the regulations before the National Assembly next year, I'd have to put proposals in front of you either to increase the budget available or to find a way of narrowing the entitlements within the schemes, so that it can live within the budget that it has. We are in the fortunate position of not having to do that next year. The budget we have is sufficient. The scheme has not been narrowed, it's been marginally extended in its generosity, and I hope that Members in the Chamber will be willing to support a scheme that puts a large sum of Welsh Government money directly into the pockets of those whose circumstances are amongst the most difficult in the land.

Thank you very much. The proposal is to agree the motion. Does any Member object? Therefore, in accordance with Standing Order 12.36, the motion is agreed.

Motion agreed in accordance with Standing Order 12.36.