Council Tax arrears is the most common debt problem in Wales, according to a report by Citizens Advice.
Its Fairness for All document identified a number of causes leading to a significant rise in the number of people who have arrears. It stated: “Living on a low income and a change of circumstances, such as losing a job or ill health, are common triggers which can lead to unmanageable debt. These were common themes cited during our research by both advisers and clients.”
A frequent finding was that people who had council tax debts would often have recovered help and advice on other debts, most often rent arrears and water debts. This prompted the report to note: “This reflects the changing nature of debt being seen by Citizens Advice in recent years, with increasing numbers of people seeking help on essential household bills.”
Other common factors included low pay, irregular and insecure work, changes to the levels of council tax reduction caused by being in and out of work, delays in receiving benefit payments and a lack of understanding of the benefits system.
However, poor budgeting skills and an “inability to prioritise debt payments” were also cited.
For many people, whatever the cause of their financial troubles, a debt solution such as an Individual Voluntary Arrangement (IVA) could be an effective way to deal with problem council tax debt. For those who feel they may lack the budgeting skills to handle their debts, finding a debt solution will be a key step to getting back on an even keel.
The report noted that most of the cases of debt do not involve people who demonstrate an unwillingness to pay, with cases of leaving mail relating to payment unopened usually being the result of feeling overwhelmed by the situation, rather than deliberately trying to avoid payment. Most cases Citizens Advice encountered came only when the situation had got so bad that legal action was being threatened by the local authority.
By Joe White