The Committee heard from the Revenues Manager with a report seeking to consider and agree the proposal for the expenditure of the refund of Magistrates court fees. It was explained that prior to 2018 the Council was required to make payments of £3 for every liability order issued by the Lincoln Magistrates. These fees were paid by every local authority in accordance with council tax legislation, however, following a successful challenge in 2014, the regulations were amended in 2018, dated back to 2014, reducing the fees to 50p per liability order.
Members heard that this matter had been with the Ministry of Justice since 2018 waiting for them to confirm when and how they would pay each local authority. They had recently contacted the Council, detailing the refund they believed to be due and had stated the sum of £24,605.45 (which included interest paid at 1.73%). Evidence of further payments totalling £7,385.72 made during the four-year period had been submitted to the Ministry of Justice for an additional refund and this was currently under consideration.
The regulations did not stipulate how this refund should be distributed and consideration had been given to the various options available to the Council. If the Council chose not to award any payments the refund would be absorbed into the general fund and would not benefit any council taxpayers. If there was to be refund of £2.50 in respect of each liability order, this would require a manual exercise involving each account having to be checked. This would cost almost as much to administer as the refund itself and would take over 100 days to complete.
It was explained to Members that if the Council were to set up a council tax discretionary hardship fund for 2022/23, this would enable the Council to offer some financial assistance to some of the district’s more vulnerable residents. It was highlighted that the benefits of having such a fund last year proved invaluable and enabled the Council to achieve a 98.02% collection rate which was 0.01% higher than the previous year. The Committee was therefore being asked to approve this proposal.
Members spoke in favour of the proposed discretionary hardship fund and expressed thanks to the Revenues Manager and her team for their hard work. Having been moved and seconded, the Chairman took the vote and it was unanimously
a) option 1 of the report, that the refund of Magistrates court fees be set aside for a council tax discretionary hardship fund to be set up for 2022/23, be approved; and.
b) any additional refund of Magistrates court fees be added into the discretionary hardship fund for 2022/23 as and when they be determined by the Ministry of Justice; and
c) in the event of any discretionary fund being unpaid, any residual amount be made available for 2023/24 as a new discretionary fund.