Council Tax Revenue: Student Accommodation

The Government believe it is right that students are disregarded for council tax. If the only residents of a household are full-time students, the dwelling will be exempt. In the recently published fair funding review 2.0, the Government proposed to fully account for the impact of student exemptions in the distribution of the settlement.

In 2013, my Bath council received £31 million through the revenue support grant. This year, it is just around £1 million. Students, who are exempt from council tax, are not being counted. Will the Minister ensure that, through the fair funding review, the issue is urgently addressed, and that councils such as Bath and North East Somerset are not missing out entirely on central Government support?

The fair funding review will do what it says on the tin: it will make sure that, for the first time ever, all component pressures that councils face in delivering public services, and in raising money locally, are taken into account. It is wrong that while this Parliament can decide on national exemptions that councils have to apply, which limit their ability to raise council tax locally, we do not account for that in the distribution of funding that follows. For the first time, we will do that.

Liverpool is a university city, and I have three universities in my constituency. Liverpool city council is estimated to lose £9 million in council tax revenue each year due to student exemptions. Will the Minister explain when and how those anomalies will be dealt with, so that the council does not lose that amount of funding every year?

The fair funding review 2.0 is out to consultation. We welcome contributions to the consultation from Members, local authorities and others. At heart, we want to fully account for the ability of an area to raise income locally. Nationally, there are 245,000 student exempt dwellings and 77,000 halls of residence. It is quite right that we take that into account when we assess how much council tax can be raised locally. In some cities and towns, that will make quite a material difference.