Agenda item

(a)       That the council tax premium scheme be introduced from 2017-18;

(b)       That a 50% premium be adopted for the first year of implementation in 2017-18 for properties classed as second homes and long term empty homes; and

(c)       That the premium level during the first year of implementation be reviewed with a view to increasing the rate from 2018-19 after taking into consideration the effectiveness of the new policy in incentivising owners to bring long term empty property and second homes back into full use.

The Chief Officer (Community & Enterprise) introduced a report seeking approval to introduce a premium on long-term empty homes and second homes from April 2017, as set out in the Housing (Wales) Act 2014.  In presenting the report, she explained that it was a key strategic priority for the Council to encourage individuals to utilise the range of support available, to minimise the number of empty homes and bring them back into use.  There were currently over 800 empty properties which could benefit local people on the housing waiting list and help to meet the anticipated demand for social and affordable homes.  Approval by full Council was required at this stage to allow the requisite 12 months’ notice to be given to owners to charge the premium and to remind them of the support routes available to help bring their empty homes back into use.

The Revenues Manager explained that under the legislation, Welsh councils had the option to charge up to 100% additional Council Tax for long-term empty properties and second homes to meet local housing needs.  The proposal to introduce a 50% premium for the first year starting in 2017/18 had been recommended by the Community & Enterprise Overview & Scrutiny Committee and endorsed by Cabinet.  Consultation with residents had resulted in two responses: one opposing the premium for second homes and the other raising concerns about empty properties for sale.  However, the Welsh Government (WG) had introduced a range of safeguards to lessen the impact on residents, including granting a further 12 month exemption from April 2017 for owners of long-term empty properties for sale.

In moving the recommendations, Councillor Chris Bithell welcomed the aim to reduce the housing waiting list and tackle the problem of uninhabited empty properties which impacted on neighbourhoods, acknowledging the safeguards in place for specific cases.  In response to a question, the Revenues Manager confirmed that the legislation allowed unoccupied properties with no probate granted to be exempt indefinitely from Council Tax until such time as probate was granted.  Councillor Aaron Shotton seconded the proposal and thanked the officers for the detailed report.

Councillor Mike Peers raised points about the need to understand the implications of the new regulations and the effects of reducing government grants.  He felt that examples could have been provided to support the rationale of introducing a 50% premium and its impact, and suggested an amendment for a variable 25% premium to be applied in the first year depending on the condition of the building.  This was seconded by Councillor Owen Thomas.

The Chief Officer (Community & Enterprise) explained that although details of the new regulations had only recently been received, discussions had been ongoing for some time in preparation for the new legislation.  Despite the Council’s stance in charging full Council Tax on empty homes in the county and actively promoting the range of support available to minimise empty homes, over 800 homes were currently empty.  It was for this reason that a premium of 100% had been considered, however 50% was proposed to be consistent with the other councils across the region.

In response to comments from Councillor Alex Aldridge on the proposed amendment, the Chief Executive confirmed that this was a Council matter and was therefore subject to legitimate challenge.  He explained that the 50% benchmark had been set in view that this was new legislation.

The Revenues Manager stressed the importance of a determination by Council 12 months’ ahead of implementation.  In response to the amendment, he stated that WG guidance gave councils the option to vary their determination within the 12 month period, however he felt it was important to state clearly and show consistency on the determination.

On being put to the vote, the amendment was lost.

In response to a query from Councillor Clive Carver, the Chief Executive said that monies raised by the Council contributed to local services and that charges for second homes were legitimate.  Councillor Gareth Roberts welcomed the recommendations in addressing long-term uninhabited houses which were a blight to local communities.  In supporting the recommendations, Councillor Kevin Jones commented on the 12 month exemption for long-term properties put up for sale and the need for the Council to benefit from the value of sold properties which had been brought up to standard.

The Revenues Manager advised that the Council decision would take effect on long-term empty properties and second homes from 1 April 2016, giving 12 months’ notice before the premium was applied or extending for a further 12 months for properties for sale, giving opportunity to encourage owners to bring their properties back into use.

Councillor Richard Jones referred to the figures in the report and asked about the expected number of exceptions.  Officers explained that exemptions had not been taken into account as this was difficult to predict at this time, however ‘real time’ information would be shared with Cabinet and Overview & Scrutiny over the next 12 months.  It was acknowledged that the figures quoted would include some genuine cases where there would be a deferral of the charge.

On being put to the vote, the substantive motion was carried.

RESOLVED:

(a)       That the council tax premium scheme be introduced from 2017-18;

(b)       That a 50% premium be adopted for the first year of implementation in 2017-18 for properties classed as second homes and long term empty homes; and

(c)       That the premium level during the first year of implementation be reviewed with a view to increasing the rate from 2018-19 after taking into consideration the effectiveness of the new policy in incentivising owners to bring long term empty property and second homes back into full use.