Croydon’s Council Tax scheme to face High Court challenge

CROYDON IN CRISIS: Errors in applying Council Tax exemptions for the elderly and disabled, as well as carers and students, has led to a Judicial Review to be heard tomorrow

Judgement day: Croydon’s management of its Council Tax scheme has led to the legal challenge in the High Court

A judge in the High Court will hear a case tomorrow that claims that changes to Croydon’s Council Tax Reduction Scheme made last year were not legal or fair, and discriminated against the old, disabled and other protected groups. The case could have implications for local authorities across the country.

The Judicial Review has been brought by Croydon resident Dr Yusuf Ali Osman, who is blind and unable to work full-time. Dr Osman has been a member of the council’s health scrutiny committee and on the adult social services users’ panel.

Dr Osman’s case claims that the changes left pensioners, disabled people, carers, students and foster parents to pay Croydon’s Council Tax bills when, in the years before 2022, they would have been exempt.

The case brought on behalf of Dr Osman claims the changes were a result of the council applying the Minimum Income Floor – or MIF – to people who are protected from the MIF under Universal Credit regulations.

Under Universal Credit, the MIF applies only to people required to be in, or looking for, full-time work. But Croydon’s MIF omitted that component and included categories of residents who would usually be exempt under Universal Credit.

The MIF assumes self-employed people have a weekly income of £332.50 (minus tax and National Insurance). But some groups of people are exempted in Universal Credit because they are in reality unable to achieve this level of income. Applying the MIF means that their Council Tax liability is not reduced in line with their actual income.

Dr Osman claims the 2022 CTR scheme initially discriminated against him as a self-employed resident with a significant disability, and left him facing a Council Tax bill of hundreds of pounds when in the past he had been exempt.

Croydon’s CTR Scheme also ceased to disregard the disability-related income of people on means-tested benefits, meaning that they are effectively paying money meant for their disability on Council Tax.

Only after Dr Osman launched a legal challenge to the council’s new rules about the MIF and disability-related income in its 2022 scheme did Croydon Council decide to exempt him from Council Tax. It has also this month removed the MIF category that affected him, as a disabled resident, with the result that Dr Osman will not have to pay Council Tax in 2023.

The changes, which became effective on March 1, are for the 2023 scheme and free disabled people from the discriminatory provisions, but the scheme still affects other people who are not expected to be in full-time work.

Cashing out: Croydon changed its scheme after it learned of the legal challenge

Croydon Council says the legal claim is now academic because it has changed its CTR Scheme, but Dr Osman is persevering because he argues that although the latest rule change benefits him, other vulnerable Croydon residents are still left having to pay Council Tax when they should properly be exempt.

They include people who care for people with disabilities or under-threes, pensioners with a working-age partner, recent adopters, many students and many foster parents.

The recently revised Croydon CTR scheme does contain a partial exemption for lone parents, whose minimum income floor is set at the equivalent of 20, not 35 hours, per week.

While the scheme disregards some disability-related income, it still does not disregard the disability-related component of Employment and Support Allowance.

“Croydon Council only specifically provided an exemption from the MIF for self-employed disabled residents after I launched a legal action,” Dr Osman said, “and it is still failing to acknowledge the mistakes it has made.

Strong case: Dr Yusuf Osman

“I feel strongly that Croydon should acknowledge that it has not introduced the MIF in line with the Universal Credit regulations and that it has not continued to disregard all disability-related income. Its 2022 scheme did neither of these things, and none of the documents relating to the 2023 scheme indicate that the council has acknowledged these two fundamental issues.”

Dr Osman is represented by Leigh Day solicitor Kate Egerton, who said: “Dr Osman will make the core argument that Croydon Council misdirected itself in 2022 by believing its MIF would be ‘applied in line with Universal Credit’, while in reality its MIF is not aligned with UC and, resultingly, has discriminatory and irrational effects.

“The 2023 changes still do not replicate the UC exemptions and the council continues to fail to acknowledge this.

“While the changes mean that disabled self-employed people now escape the MIF, they do not assist others who under UC would be exempted.

“We understand that there are other local authorities who may also have failed to exempt people with limited capability for work from the MIF. We hope that a positive result in this case will have an impact both in Croydon and nationally.”

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7 Responses to Croydon’s Council Tax scheme to face High Court challenge

  1. derekthrower says:

    Well done Doctor Osman in attempting to right an obvious wrong, which the administration of part-time Perry has admittedly tacitly by altering part of it’s regulations. We have seen the quality of Legal Advice that Croydon has on hand.
    It will be interesting to see the latest defence of why they appear to be exempt from the reality that has been handed down to them by secondary legislation, but with their previous record it can only be yet another waste of council tax money in why they don’t accept the points brought up in Doctor Osman’s case.

  2. Ian Kierans says:

    Croydon Council says the legal claim is now academic because it has changed its CTR Scheme?
    So they have backdated that to last year and sought out those who were denied this or were told they could not apply and repaid them?
    So they have offered compensation to those they have penalised for the hurt and shortfalls they endured?
    So they have rectified how this situation came about in the first place?
    So they are admitting that they actively discriminated against disabled people on low incomes from the beginning?

    Sorry what bit is the academic part here?
    What about all out money going to waste on defending the indefensible in court?
    Seems like another misuse of power by those of the Executive who have a callous disregard for humanity – I wonder if things will improve now under McArdle and things will be done properly for the next two years? We survive in hope.

    Surely that should be looked at by Gove? Councils wasting taxpayers money when they get caught being discriminatory and not doing their Statutory duty or breaking their own regulations.

  3. Ian Kierans says:

    I would like to wish Dr Usman good luck today. This action should have never had to be taken at all – ever.

    Public bodies have duties. Public bodies fail in those duties for many reasons. We need to get to the stage where inadvertant wrongdoing is acknowledged immediately it is known, and then rectified and put right. Honest mistakes should not be punished nor people castigated for getting something wrong
    Where the wrongs are intentional and for purpose or that it was covered up to protect said bodies or directors should not be dealt with in civil court only. They are a betrayal of the trust given by the Public.

  4. This was a Croydon Labour attack on those in need voted through with the vote of the Labour civic Mayor Sherwan Chowdhury.

    I voted against and had the Labour whip removed in retaliation.

    It is possible that the cuts to support have just led to extra cost pressures on social services provision.

    Labour platitudes in Croydon about equalities are worth little.

    • C.Gardener says:

      Thank you for standing up for all the groups effected by this Dr Yusuf Ali Osman. I for one appreciate it.

      I’m an unpaid carer.
      I do the work of three people in any one given day, each doing 8 hour shifts.
      My allowance wouldn’t even cover the first 8 hours, and they wouldn’t be expected to work for 24 hours without a decent break! Or a proper sleep!
      Out of this my council tax has risen from £25 to £58 a month. More than doubled! and rising with this 15% increase soon!
      I look forward to a favourable verdict.

  5. Sarah Bird says:

    I hope Dr Osman’s case succeeds . In my view , the whole of the council tax department needs a complete overhaul . It is unaccountable and very badly run. For reasons( best known to the staff employed at great expense) it is unable to respond to my emails and refund all monies owed to me . I understand, that I am far from alone as many attest . Tony Mc Ardle must address the very serious problems together with the numerous failings of the Council. He must meet with residents and hear first hand of the problems and be available to the residents and seen to act .Croydon Council has statutory and moral duties and is not above the law.

  6. yusufaosman says:

    I know I’m really behind with this but I wanted to thank everyone for their supportive messages it really meant a lot to me over the last few days.

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