In order to simplify and stream line the benefit system, last year Work and Pensions Secretary Iain Duncan Smith announced the launch of Universal Credit, the new benefit payment system which will replace six income-related work-based benefits, however a London Borough council is now arguing for a seventh benefit to be added.
The London Borough of Richmond says that it is facing a £1 million cut in the funding it receives to help low-income families with their council tax and is asking for the Government to integrate the benefit into Universal Credit.
Many other councils across England are also outlining the challenge that they are facing in providing a new council tax benefit system while Government funding for such schemes was cut by 10%.
The benefit which is claimed by 6 million people across the country is currently funded by DWP, however by 2013-14 responsibility for providing council tax support, will fall to local authorities in England and the Scottish and Welsh governments.
While Universal Credit will not be introduced until next year, giving time for local authorities to lobby government to add council benefit, it does mean that for the next year at least councils will either have to cut benefits or find additional funding in their already squeezed budgets.
