Croydon's Cabinet decides on 23 September whether to consult on cutting Council Tax Support. Up to 20,000 residents affected; options save £3.6m to £11.9m.

Croydon Council is preparing to consult on cutting Council Tax Support for working-age residents, in changes its own report says could affect up to about 20,000 people.

Cabinet decides on Tuesday 23 September whether to launch the consultation. If it agrees, a six week statutory consultation is planned to start on Monday 28 September, with a final decision at Full Council in February 2027 and any changes taking effect from April 2027 (Cabinet report, 23 September 2026).

Council Tax Support reduces the council tax bills of low-income households. Croydon’s scheme cost about £39m in 2025-26, of which around £25m went to working-age residents. Pensioners, who receive about £14m, are protected by national rules and cannot be affected; only the working-age scheme is up for change (council announcement, 16 September).

What could change

The report puts four illustrative packages on the table, saving between £3.6m and £11.9m a year, and stresses that keeping the current scheme is also an option. The core of every package is the maximum award: the largest share of a council tax bill the scheme will cover.

The current maximum awards, in place since the income-banded scheme began in April 2022, are:

  • 100% for disabled residents who are not working
  • 80% for lone parents with a child under five
  • 75% for all other working-age claimants

The four packages in the report would reduce those to:

  • Option 1: 50% for all three groups, saving £11.9m. The report notes this would be the joint lowest entitlement in London
  • Option 2: 70% for disabled residents not working, 50% for the other two groups, saving £8.5m
  • Option 3: 80%, 70% and 65%, saving £5.3m
  • Option 4: 90%, 70% and 65%, saving £3.6m
Table graphic of Croydon's four Council Tax Support options for 2027-28. Maximum awards for disabled not working residents would fall from 100 per cent now to 50, 70, 80 or 90 per cent under options one to four; for lone parents with a child under five from 80 per cent to 50, 50, 70 or 70 per cent; for all other working-age claimants from 75 per cent to 50, 50, 65 or 65 per cent. Estimated annual savings are 11.9, 8.5, 5.3 and 3.6 million pounds respectively
The four packages in the Cabinet report, against today's scheme. Savings include the GLA share. Graphic by Croydon Today, from the Review of Council Tax Support Scheme 2027-28.

The consultation would also ask about other parts of the scheme:

  • Cutting the earnings disregard for disabled working claimants from the first £50 of weekly earnings to £25 or to nothing
  • Reducing the band cap from D to C, so support for anyone in a band D home or above is worked out as if they lived in a band C one, and possibly applying a cap to disabled residents for the first time
  • Changing the capital limit, currently £16,000 in savings for protected groups and £8,000 for everyone else, above which no support is paid
  • Narrowing who counts as disabled and not working for the protected group
  • Disregarding income from war disablement pensions and compensation schemes
  • Transitional arrangements or a bigger Council Tax Hardship Scheme to soften any change

Why the council says it is doing this

The council is under a Best Value intervention, and the report says the government has issued formal directions requiring it to show it is reviewing significant areas of spending. Of the £25m working-age cost, around £5m falls on the Greater London Authority and about £20m on Croydon itself.

The report’s benchmarking finds the lowest maximum award anywhere in London is currently 50%, and argues Croydon’s scheme “provides substantial levels of support and costs more than those operated by many other London boroughs”. Croydon last cut the scheme in April 2022, when moving to income bands saved £4.4m.

Executive Mayor Jason Perry said: “No decisions have yet been made on the future of the scheme. Should Cabinet approve the consultation it will provide a genuine opportunity for people to shape future recommendations.”

What it means for you

  • If you are a working-age resident getting Council Tax Support, the options range from a modest trim to a halving of the maximum help. Under the biggest option, a disabled resident who is not working and currently pays nothing would become liable for half the bill. Your council tax band sets what that means in pounds.
  • If you are a pensioner, nothing changes. The pension-age scheme is set nationally and is outside this review.
  • The consultation is the moment to speak. Subject to the Cabinet vote, it runs for six weeks from 28 September, with an online survey on the council’s website and paper copies in libraries. The council says responses will shape the recommendations put to Full Council in February 2027.
  • Nothing changes before April 2027, and the report commits to considering hardship support and transitional protection alongside any cut.

Sources