Rates discount change could add to financial burden for older people, warns Mid and East Antrim Borough Council

The local authority has been responding to a consultation by the Department of Finance (DoF) on domestic rating proposals.

The Department is seeking views in relation to two proposals – a reduction in early payment discount from four to two per cent as opposed to a full removal of the discount and an increase in maximum capital value rather than “a full removal of the maximum capital value”, increasing the maximum capital value cap from £400,000 to £485,000.

Currently, domestic rate bills are calculated based on the capital value of a property. Properties valued at more than £400k are billed at the top rate. DoF is proposing to increase this cap to £485k rather than removing it entirely as first proposed.

This is expected to affect 3,600 properties across Northern Ireland which would result in the highest domestic rates bill generating an additional £2m annually for the Northern Ireland Executive with an equivalent amount allocated to district councils depending on the location of the most expensive properties.

Mid and East Antrim Borough Council says that this would have the most impact in the Belfast City and the Ards and North Down Borough council areas stating: “While we support increasing the cap to £485k, it is crucial to ensure a fair and sustainable distribution of funds across all councils.”

A report to a recent meeting of Mid and East Antrim council’s Corporate Resources, Policy and Governance Committee indicated that during the 2023/24 financial year, 163,000 ratepayers in Northern Ireland availed of the early payment discount, resulting in a loss to the Executive of £8m.

Mid and East Antrim Borough Council supports the discount being retained at four per cent and has noted that it is mainly pensioners who avail of the discount.

The local authority says that it has “concerns about its impact on those most likely to avail of the discount, particularly older ratepayers”.

"Recent impacts due to changes in welfare support for this group would potentially be compounded further by such a change”, the council’s response said.

It was also noted: “The proposed changes may disproportionately affect certain groups, such as older or low income ratepayers who rely on the early payment discount to manage their finances

"It is important to ensure that these changes do not create unintended barriers to payment or exacerbate financial inequalities among ratepayers.

"Reducing the early payment discount could impact ratepayers who rely on the incentive to manage their finances. If this results in increased late payments, or bad debts, councils may face higher administration costs related to debt collection and enforcement reducing the net financial benefit,” the council report stated.

"Any additional financial burden on residents may impact on their ability to pay for a range of services and could increase issues such as food and fuel poverty. This in turn could place greater pressure on wider public services.”