Deep in the laws of the land lies a remarkable legislative hangover that allows your council to throw you in prison if you don’t pay your council tax.
It conjures images of fictional chancers peering through the bars at Newgate prison at some point in the distant past. But the reality is much closer to home.
Described as a “legal anomaly” by campaigners now calling for its end, the rules in England and Wales differ significantly not just from the rest of Europe but also the rest of the UK.
Council tax debt is not a crime but magistrates in England and Wales can and do still send some people with council tax arrears to prison for up to three months.
Raising awareness of the negative impact of court actions on families and vulnerable individuals, the Institute of Money Advisers and free debt advice service PayPlan are calling for an end to what has been called a “draconian sentence” after new figures were released showing huge regional inconsistencies in the use of the rules.
A Freedom of Information request has revealed that 99 out of 279 local authorities took court action for imprisonment against 4,817 people in 2016/17 – up by more than 10 per cent compared with 2012/13.
Topping the list was Bradford Metropolitan Council, which launched court proceedings against 969 people, resulting in 18 being jailed. In second place, committing 14 people to prison, was the Vale of Glamorgan Council. Coventry City Council was the second biggest user of court action for imprisonment recording 156 cases and five prison sentences.
Now Alistair Chisholm, head of advice sector policy at PayPlan, is urging councils to think twice about dishing out tough penalties to those already experiencing severe hardship.
“Court action and the threat of prison are deeply distressing for the most vulnerable householders, who believe they have been unfairly lumped together with criminals,” he said.
“Each day, our advisers speak to callers who find themselves in a difficult situation because of relationship breakdowns, illness or unemployment, or a combination of these factors. In most cases, there is no lawful reason to jail someone – but even the threat can be very damaging. While the number of imprisonments has actually dropped since 2009/10, the threat of imprisonment is being more widely used.
“Receiving court letters, let alone having to find legal advice and stand before magistrates, is terrifying and completely out of proportion when no offence has been committed.
Many people struggle to plug the gap between their income and their bills, and as a result council tax debt is a growing problem across the country. Threats of imprisonment is not the right answer to this problem.”
“Imprisonment does not clear their debt – in fact, it usually increases it further,” says Robert Wilson, chief executive of the Institute of Money Advisers. “Putting people in prison makes it harder for them to make payments and can cause chaos in their work and family life. On top of that, taxpayers also have to meet the costs of prison."
Won’t pay, can’t pay
The rising cost of living and the squeeze on real wages makes it much more likely that those struggling to cover their council tax costs fall into the “can’t pay” category than the won’t pay one, says Andy Shaw, debt advice policy co-ordinator for debt charity StepChange.
“Aside from committal, powers to recover council tax are already extensive, including the ability to directly deduct arrears from benefits or income, beginning bankruptcy proceedings and, if the debtor is a homeowner, placing a charge against their property.
He worries that people don’t realise how serious getting behind on their council tax is until far too late. Councils will typically send out one or two reminders before escalating the matter to the courts. Compare this to consumer creditors who the Financial Conduct Authority (FCA) is encouraging to avoid the use of courts and bailiffs and instead explore reasons for their customers failing to pay before coming to a solution that fits their customers’ financial circumstances.
The use and powers of bailiffs is currently also under scrutiny by debt charities and consumer groups.
Indeed, Hammersmith & Fulham local authority in London recently announced that it would no longer engage bailiffs at all and would instead engage more with struggling residents.
“As well as action by Government and local councils, we need improved training for magistrates and court staff,” adds Wilson. “Dealing with the growing number of people who have serious money problems requires expertise.
"Debt is complicated, and officials need an informed, professional understanding of the realities of living with financial difficulty.”
Case study: Jailed after Christmas
Mark Brigham, debt team leader at Citizens Advice in York, recalls one case, from a different local authority, that shook both him and the council.
“The first day we came back after Christmas a woman came in reporting that she had been summoned to appear in court for non-payment of council tax. In her fifties, she and her husband were vulnerable. They weren’t claiming the right benefits and were in bad health.
“They owed council tax of around £2,100, though the summons was only for around £700,” he recalls.
Brigham and his colleagues prepared a detailed account of the couple’s financial affairs for them to use in court and informed the woman that although a jail term as technically possible, it was highly unlikely.
In England and Wales, a jail sentence is one option for a magistrate who determines that the individual has wilfully refused to pay their council tax or has been wilfully negligent. Magistrates usually also have the power to dismiss the case and write off the debt if they see fit.
“The judge decided that because she was paying off a debt from a clothing catalogue – the only way she could afford to clothe herself and her husband – before her council tax bill, that she was showing wilful refusal. She was sentenced to 3 days less than the maximum term.”
“It shocked us and the council involved in the case.
“Because this isn’t a criminal matter, there’s no possible reduction in the sentence for good behaviour. The only way you can be released early is if the bill is paid off. Her husband was unable to raise the money and she served the full sentence. She had had no previous experience of prison and it affected her deeply.
“It was pure punishment. She entered insolvency when she came out, at which point the debt was written off. She had been punished because she didn’t understand her options and didn’t act quickly enough.”
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies