Today in Parliament the Labour Party has opposed an amendment that would have allowed councils to protect their poorest households from a cut in council tax support.

In a tough spending review, a decision was taken to localise council tax benefit and reduce the funding by 10%, with local schemes due to come into force in April 2013.

After Lib Dem pressure, the government gave councils discretion over the discounts to empty and second homes and allowed councils to charge a 50% premium on homes that have been empty for more than 2 years. However this still left many councils with a choice between reducing support for all working-age recipients or absorbing the cut into already stretched budgets through service cuts or a council tax rise.

The amendment, tabled by Lib Dem peer Lord Tope but with support from Cross-Bench peers, sought to give councils the freedom to reduce their single persons discounts from 25% to 20% for working age residents. This would have helped them deal with the current funding gap in council tax support and protect those on the lowest incomes. However Labour peers were instructed by their party to oppose this change.

Cllr Gerald Vernon-Jackson, Leader of the Liberal Democrats in local government said –

“Within the constraints left by Labour’s financial mess, Lib Dems have been working to minimise the pain of this ill-conceived Conservative cut to council tax benefit s. Our solution would give councils more freedom to protect hard-working families on low-incomes – but Labour want them to feel the pain.

“Labour’s cynical attitude to the working poor is, ‘No Pain, No Electoral Gain’. It’s more important to them to seek out some political advantage than protect low-income families.”

After the vote, Lord Tope, Liberal Democrat local government spokesperson in the Lords said:

“This was a common-sense solution, giving councils some freedom to decide on the best mix of council tax discounts for their area whilst ensuring that no-one is asked to pay what they cannot afford. In cynically blocking this solution and ensuring maximum cost to the working poor, the Labour Party have finally laid bare where their priorities lie, and it is not with improving the lives of those on the lowest incomes.”