To recommend to the Executive Committee that the revised Prosecution Policy for the Council Tax Reduction Scheme be approved.

21.1           The report of the Revenues and Benefits Group Manager, circulated at Pages No. 148-163, set out the current position regarding the Prosecution Policy for the Council Tax Reduction Scheme.  Members were asked to recommend to the Executive Committee that the revised Prosecution Policy be adopted, as set out at Appendix 2 to the report.

21.2           Members were advised that the Council was no longer required to investigate and prosecute Housing Benefit and Council Tax fraud as those responsibilities were now being carried out by the Single Fraud Investigation Service and the Crown Prosecution Service.  The Borough Council still had a responsibility to investigate Council Tax Reduction Scheme Fraud, which was the replacement for Council Tax Benefit.  On that basis, it was necessary to review the existing Prosecution Policy and make appropriate changes.

21.3           Referring to Paragraph 2.2 of the report, the Revenues and Benefits Group Manager explained that the main changes would remove any reference made to Housing Benefit and Council Tax Benefit and replace them with ‘Council Tax Reduction Scheme’; include Council Tax Reduction Scheme offences; change the title of the Revenues and Benefits Manager to read ‘Revenues and Benefits Group Manager’; make changes to the section covering administrative penalties to reflect the Council Tax Reduction penalty requirements and delete the section on collection of the penalty; and include a section on other penalties where the Borough Council could impose a penalty of £70 for cases where it was determined that fraud had not been committed and the person had either been negligent in making an incorrect statement, or had no reasonable excuse in failing to notify the Borough Council of a change in circumstances.  All changes were highlighted at Appendix 2 to the report.

21.4           In response to a Member query regarding the imposition of penalties, the Revenues and Benefits Group Manager clarified that there was a new penalty which could be applied in cases where it was determined that fraud had not been committed and the person had either been negligent in making an incorrect statement, or had no reasonable excuse in failing to notify the Borough Council of a change in circumstances.  The £70 penalty rate was set by the Department for Work and Pensions and could not be amended.  A Member queried how this would be enforced and was advised that Officers would investigate cases as they had done previously with Council Tax and Housing Benefit when they had been able to administer penalties if appropriate.  The Member went on to question whether the penalty would cover the cost of carrying out the investigation.  The Revenues and Benefits Group Manager indicated that this would depend on the length of the investigation and the amount of work that had gone into the process; if the Council had been made aware of the change of circumstances within a reasonable period then an investigation may be unnecessary and the penalty would cover the cost of Officer time, however, a full fraud investigation could cost up to £3,000.  A Member asked what the likely recovery rate would be and was informed that a payment plan would be established with individuals in difficult circumstances and most did adhere to the plan.  The Revenues and Benefits Group Manager did not have enforcement or collection rate figures to hand but he provided assurance that all cases were followed through and action was taken to recover penalties where appropriate.  The Finance and Asset Management Group Manager indicated that an updated Prosecution Policy would assist with the recovery of outstanding debt and there would be less need for bad debt provision if more money could be recovered throughout the year.

21.5           Having considered the information provided, it was

RESOLVED          That it be RECOMMENDED TO THE EXECUTIVE COMMITTEE that the revised Prosecution Policy be ADOPTED as set out at Appendix 2 to the report.