Tower Hamlets Council’s Labour administration is protecting support for the borough’s poorest residents through its council tax reduction scheme (CTRS), despite the huge financial challenges facing the local authority.

Tower Hamlets Council has had to make £200m in savings since 2010, with budgets cut by the Government and squeezed by additional demand. The council also has to save a further £30m by 2024 following a decade of Government austerity, changes to council funding, and the Covid-19 crisis.

Despite this, the council is protecting its CTRS which partly or fully reduces council tax bills for residents on the lowest incomes, with over 31,000 households receiving some form of discount in the borough as a result, and over 17,500 families receiving a 100% reduction meaning they don’t have to pay a single penny of council tax.

Tower Hamlets Council is one of the few councils in the country that continues to offer a full 100% reduction scheme, as many councils have a minimum payment meaning that all households must pay at least some proportion of their council tax.

Over the past year, the financial impact of Covid-19 on household budgets has meant that more residents have needed this support, and the cost of the CTRS to the council has risen from £26.7m in 2019-20 to around £31.8m in 2020-21.

The Labour council has also committed to protecting its universal free school meal scheme, at a cost of £3m per year, which sees every primary school child receive a free school meal.

John Biggs, Mayor of Tower Hamlets, said: “The huge financial challenges that we face means we have to take some very difficult decisions and target our resources carefully. Government funding cuts, rising demand and the cost of Covid have created a perfect storm, with local councils right across the country struggling to cope.

“I’m very proud that despite the challenges we face, we’ve been able to protect our council tax reduction scheme and continue to provide vital support for some of the poorest in our community.

“This support will make a big difference to thousands of households across the borough, and is reinforced by our other work to tackle poverty such as universal free school meals and our multi-million pound Tackling Poverty Fund.”

Cllr Candida Ronald, Cabinet Member for Resources, said: “The economic impact of Covid-19 on households and businesses has been enormous and yet the support offered by the Government has been patchy at best, particularly with Universal Credit set to be cut in April.

“We are doing all we can to support vulnerable families, including protecting our council tax reduction scheme, and I believe it shows the difference that Labour makes in local government, supporting the poorest and most vulnerable in our community.”

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