Money expert Martin Lewis was moved to tears by the council tax change (Image: ITVX)
Money expert Martin Lewis has issued a tearful message on Wednesday after a victory in his campaign to change council tax rules.
Today, the Money Saving Expert founder revealed he is ‘a bit teary’ following an announcement by the Government that it will change the rules on how councils collect unpaid council tax arrears.
Currently, if you miss a monthly Council Tax payment, councils can force you to pay the entire year’s tax bill within three weeks, which Martin had said ‘would make banks blush’.
Now, the Government has announced it will change the rules so that local authorities must wait at least 63 days before they can demand annual payment in full, with a cap on administration costs of £100.
Martin Lewis posted a video reaction in which he admitted he is ‘a bit teary’ following the news.
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He added in the tweet posted on Wednesday, April 15: “A year ago, I was moved to tears when govt agreed to consult on Council Tax debt collection. I’m reposting that video as today IT’S DONE. On the back of @mmhpi campaigning the govt said this morning it WILL change the rules.
Martin went on: “Council tax debt collection is so aggressive it’d make banks blush. It’s the most vicious and damaging form of legal debt collection out there – causing counterproductive misery for millions. We’ve spent the last 18 months campaigning hard to change this hideous system, and having seen so much pain caused by it, I’m genuinely moved by this huge first step towards making things better.”
“Currently, in England, if you miss a monthly payment, many councils, within usually 3 weeks, demand payment for the entire year. How people who can’t find a month’s money are expected to find a year’s I don’t know. Yet if they can’t pay, within just three more weeks, they are often taken to court, have ‘admin costs’ added, and soon see bailiffs sent in. No commercial firm would be allowed to do anything close – constituents are treated worse than customers.”
The new rule from next April means councils must wait two months, not 3 weeks, to ask for a year’s money, and the ‘admin costs’ will be capped at £100.
Martin added: “ In a perfect world, it would be even longer and the lower cap would apply, but this is still a hugely welcome change to a 33-year-old process. For councils too, it is worth remembering that this grotesque system is often catastrophic for people’s finances and wellbeing, leaving many needing more help and support, and ultimately the same council having to pick up the pieces.”
The Ministry of Housing, Communities and Local Government confirmed the change in a statement. It said: “Under the current system, missing one monthly payment can leave people facing financial ruin as they become liable to pay the entire outstanding sum in a single payment just two weeks later.
“This will change from next year with households given 63 days, roughly two months, to settle their bill and a requirement for councils to work with them on a sustainable repayment plan.
“Billing for council tax will also be shifted to 12-month payments by default, rather than the current 10 months, and capping the costs which councils can charge when seeking a liability order – how councils recover overdue bills – to £100.”
Local Government Secretary Steve Reed said: “Too many families are facing aggressive enforcement action, with people left terrified of bailiffs knocking on the door because one month’s council tax bill was missed.
“We will stop this and make the system fairer by supporting families who fall behind. I want to thank Martin Lewis and his charity for their tireless campaigning, shining a light on this crucial issue affecting millions of people.”
Minister for Local Government Alison McGovern said: “We know the way council tax is run is outdated and confusing and has stopped some of the most vulnerable people from accessing the support they need.
“Our changes will cut through the complexity and make sure that council tax is fit for the 21st century.”
