The term 'claim' does not appear in council tax discount law. This discount is not 'claimed' in the same sense that benefits are. I pointed out to the Audit Commission that its use of the term 'claim' did not reflect the legal position. It replied that this was 'mere pedantry', that the words used to describe the discount did not matter, and that it was irrelevant as this was not how the exercise works.
If whoever wrote this had read the material in what appears to be a 'pop up' asserting, once again utterly falsely, that the comparison between council tax data sets and the full electoral register provided evidence of two inconsistent claims, they were probably not telling the truth. For, clearly, this is, in the minds of anybody foolish enough to believe what it says on the NFI secure web site, precisely how the exercise works. One claim or the other has to be false. More junk, more inconsistent nonsense from Audit Commission staff who appear not to be au fait with their own documentation or the law.
This explains why people are getting taken off the electoral register as a result of this match.
Some clown thinks that the same people should appear on both data sets. Give that man some proper training.
'Minimal' interference with the right to vote! Who says so? Oh yes, Clive Lewis. Perhaps he should do some research into what is actually happening and think again!
Sunday, 24 July 2011
The London Borough of Hillingdon. Incorrect Council Tax Guidance
The London Borough of Hillingdon boasts that the Audit Commission was impressed by the way it administers council tax discounts. It is a pity that the Audit Commission does not check whether the Borough was complying with the law and doing the job properly, especially as the Commission has a remit to ensure proper governance and the effective delivery of services.
Proper governance, obviously, involves complying with legal requirements.
If you ring Hillingdon, and ask about discounts, they will tell you that if two adults are resident the full tax is payable. You can point out that some adults are disregarded, and they will repeat their assertion, justifying this by reference to some guidance notes they have in the office and on their internal internet. If, curious, you ask them to send this guidance, they do.
The guidance is full of nonsense about the tax being made up of a property element and a person element. Why waste valuable space on such junk? I do not know why so many councils falsely assert that the 'full' council tax is based on two residents: the law says nothing of the sort. Who started this nonsense, I wonder?
It says on page two that 'Where the property is occupied by two or more adults aged 18 or over (what other sort of adult is there?) then the tax is payable in full. In case the reader is a complete idiot, the guidance helpfully explains that 'full' means 100%. It is not true that if two adults are resident the full tax is payable. Yes, later on the guide does make this clear, but why make the incorrect statement in the first place?
The guidance leaflet says
'If you are receiving a discount you are obliged by law to inform us if, because of a change of circumstances, you no longer qualify for the discount'.
This may or may not be 'right' depending on what they mean by 'a discount' and 'the discount'.
The leaflet, worryingly, then discusses different types of discount. Page 2 discusses a 'Single person household discount'.
Page 4 mentions 'students and other discounts'. This is legally inaccurate and misleading. 'Student' is a disregard category and not a type of discount. This is what philosophers call a category error, and what I call junk.
Further category errors appear later in the booklet.
Disregarded adults are said to 'qualify for a discount'. The disregarded adult is probably not the person liable to pay and therefore cannot possibly 'qualify' for a discount.
They also seem to expect you to put on the list of residents people who are not deemed to be resident for council tax purposes. This would appear to be none of the business of the council tax department.
The council expects you to fill in an application using various 'codes' to describe disregard categories.
It seems to expect you to keep this information up to date and it falsely states on the web site that it has powers under the law to fine you if you do not. This is utter junk.
And this is the council from whom the Audit Commission took advice, upon the basis of which hundreds and thousands of people have been falsely suspected of fraud. This is the council which drafted the model 'investigation' letter in the legally inaccurate and hitherto secret 'Audit Guide' provided to 'investigators'.
You begin to realise the most probable source of all the junk produced by the Audit Commission in the form of 'Audit Guide' material for investigators.
Laugh! I nearly cried.
Proper governance, obviously, involves complying with legal requirements.
If you ring Hillingdon, and ask about discounts, they will tell you that if two adults are resident the full tax is payable. You can point out that some adults are disregarded, and they will repeat their assertion, justifying this by reference to some guidance notes they have in the office and on their internal internet. If, curious, you ask them to send this guidance, they do.
The guidance is full of nonsense about the tax being made up of a property element and a person element. Why waste valuable space on such junk? I do not know why so many councils falsely assert that the 'full' council tax is based on two residents: the law says nothing of the sort. Who started this nonsense, I wonder?
It says on page two that 'Where the property is occupied by two or more adults aged 18 or over (what other sort of adult is there?) then the tax is payable in full. In case the reader is a complete idiot, the guidance helpfully explains that 'full' means 100%. It is not true that if two adults are resident the full tax is payable. Yes, later on the guide does make this clear, but why make the incorrect statement in the first place?
The guidance leaflet says
'If you are receiving a discount you are obliged by law to inform us if, because of a change of circumstances, you no longer qualify for the discount'.
This may or may not be 'right' depending on what they mean by 'a discount' and 'the discount'.
The leaflet, worryingly, then discusses different types of discount. Page 2 discusses a 'Single person household discount'.
Page 4 mentions 'students and other discounts'. This is legally inaccurate and misleading. 'Student' is a disregard category and not a type of discount. This is what philosophers call a category error, and what I call junk.
Further category errors appear later in the booklet.
Disregarded adults are said to 'qualify for a discount'. The disregarded adult is probably not the person liable to pay and therefore cannot possibly 'qualify' for a discount.
They also seem to expect you to put on the list of residents people who are not deemed to be resident for council tax purposes. This would appear to be none of the business of the council tax department.
The council expects you to fill in an application using various 'codes' to describe disregard categories.
It seems to expect you to keep this information up to date and it falsely states on the web site that it has powers under the law to fine you if you do not. This is utter junk.
And this is the council from whom the Audit Commission took advice, upon the basis of which hundreds and thousands of people have been falsely suspected of fraud. This is the council which drafted the model 'investigation' letter in the legally inaccurate and hitherto secret 'Audit Guide' provided to 'investigators'.
You begin to realise the most probable source of all the junk produced by the Audit Commission in the form of 'Audit Guide' material for investigators.
Laugh! I nearly cried.
Thursday, 14 July 2011
Can one challenge the Council's Accounts?
The Audit Commission not only demands the personal data of residents in order to misinterpret it and falsely allege that there is a suspicious discrepancy justifying an investigation, it also charges councils for the privilege.
The question is how much money do councils pay the Commission for producing these legally flawed interpretations of the financial situation of named individuals and can one question these through the audit procedure?
More on this later.
Worth a thought, though.
The Auditors for one Council said, 'We are Independent of the Audit Commission'.
I suppose this would make a difference as an Audit Commission Auditor could hardly blow the whistle on his or her own employer, or the 'appointer'. Not and expect to get more work in the future?
The Council's internal accountants said they did not know they were paying for incorrect guidance as the documents containing it were confidential and they were not allowed to log in to read them. Actually their first response was to be quite stroppy and ask who had given the enquirer a copy of the document in the first place. The answer, The Audit Commission, stopped them in their tracks.
Now here's a surprise: the accountant leading the audit of the council's accounts said he had never read, guess which laws? Yes. You guessed it.
Isn't Freedom of Information a wonderful thing?
The question is how much money do councils pay the Commission for producing these legally flawed interpretations of the financial situation of named individuals and can one question these through the audit procedure?
Worth a thought, though.
The Auditors for one Council said, 'We are Independent of the Audit Commission'.
I suppose this would make a difference as an Audit Commission Auditor could hardly blow the whistle on his or her own employer, or the 'appointer'. Not and expect to get more work in the future?
The Council's internal accountants said they did not know they were paying for incorrect guidance as the documents containing it were confidential and they were not allowed to log in to read them. Actually their first response was to be quite stroppy and ask who had given the enquirer a copy of the document in the first place. The answer, The Audit Commission, stopped them in their tracks.
Now here's a surprise: the accountant leading the audit of the council's accounts said he had never read, guess which laws? Yes. You guessed it.
Isn't Freedom of Information a wonderful thing?
Sunday, 10 July 2011
The London Borough of Hillingdon. Single Person Discount Investigation Letter
According to the Audit Commission, the model investigation letter provided online for councils carrying out their fishing trips in search of fraud was provided by Hillingdon. Hillingdon has as yet to confirm or deny this.
Perhaps the Borough has now corrected the original so that the commas and possessive apostrophes are in the first place, but the Commission has not.
More importantly, this letter, begins with a legally inaccurate statement.
It opens as follows (incorrect comma as per the original)
My records show that you receive a discount on your council tax bill, as you are the sole occupier at the above-mentioned address.
The records of the General Manager of the Council Tax Office can, of course, show no such thing.
For the council has issued a bill based on the statutory assumption that there will be entitlement to the same rate of discount for the whole of the coming year.
Moreover, the recipient will know that the General Manager is talking through the wrong orifice because when the council sent the demand notice, it complied with the law and informed him of the above-mentioned statutory assumption and of his legal duty under Regulation 16 to correct it should it turn out to be wrong.
Unless, of course, the recipient lives in Hillingdon. For there is no evidence as yet that Hillingdon does comply with the clear requirements of the legislation that tells it what information it must provide with the demand notice.
On the other hand, there is evidence that somebody at Hillingdon is making up laws, and making up situations in which the council tax department can levy a penalty. For its Council Tax leaflet for 2010/11, on page 18
If you have been allowed a discount or exemption
and something changes in your household which means that
you may longer be entitled to a reduction, you have a duty to
notify the council within 21 days of the change.
Later on, the same leaflet includes the following information:
Change of circumstances
If your bill shows a discount or an exemption, you must tell
us immediately of any change in circumstances which may
affect your entitlement to either.
Changes include people leaving or joining your household,
children reaching the age of 18 even if they are still at school,
college or university, a person no longer being in one of the
discount groups, for example a student finishing their course
of study, or the property becoming occupied.
Failure to tell us within 21 days of a change without good
reason, may mean that you are liable for a £70.00 penalty.
This can be increased to £280.00 for repeated failures.
If you are receiving sole occupancy discount it is essential that
you let us know if your circumstances change and you are no
longer entitled to it.
The phrase 'sole occupancy discount' leaps out at one, since of course there is no such thing, but the Audit Commission appears to have instructed a barrister in late 2007 on the basis that there was, and on the basis that an auditor could tell by looking at the electoral register that there was probably lack of entitlement. Indeed, that is more or less the story which the NFI team's internal minutes tell.
Whatever, the true story, it is clear that the model letter allegedly supplied to the Commission by Hillingdon misrepresents the legal situation and strongly suggests that somebody in Hillingdon is misinterpreting personal data in a significantly incorrect manner.
On the face of it, then, it would appear that the Audit Commission is taking advice from a council which cannot even provide to its customers clear, fair and accurate information as required under its general duty of care and when a law is quite clear and specific about what it must tell them.
This opens up the interesting possibility that the rest of the incorrect material that the Audit Commission has published since 2006 on this matter also originates with Hillingdon.
And indeed the early Audit Guides produced by the Audit Commission actually thank Hillingdon for showing them the way.
But of course the Audit Commission really ought to have checked their fact first.
Perhaps the Borough has now corrected the original so that the commas and possessive apostrophes are in the first place, but the Commission has not.
More importantly, this letter, begins with a legally inaccurate statement.
It opens as follows (incorrect comma as per the original)
My records show that you receive a discount on your council tax bill, as you are the sole occupier at the above-mentioned address.
The records of the General Manager of the Council Tax Office can, of course, show no such thing.
For the council has issued a bill based on the statutory assumption that there will be entitlement to the same rate of discount for the whole of the coming year.
Moreover, the recipient will know that the General Manager is talking through the wrong orifice because when the council sent the demand notice, it complied with the law and informed him of the above-mentioned statutory assumption and of his legal duty under Regulation 16 to correct it should it turn out to be wrong.
Unless, of course, the recipient lives in Hillingdon. For there is no evidence as yet that Hillingdon does comply with the clear requirements of the legislation that tells it what information it must provide with the demand notice.
On the other hand, there is evidence that somebody at Hillingdon is making up laws, and making up situations in which the council tax department can levy a penalty. For its Council Tax leaflet for 2010/11, on page 18
If you have been allowed a discount or exemption
and something changes in your household which means that
you may longer be entitled to a reduction, you have a duty to
notify the council within 21 days of the change.
Later on, the same leaflet includes the following information:
Change of circumstances
If your bill shows a discount or an exemption, you must tell
us immediately of any change in circumstances which may
affect your entitlement to either.
Changes include people leaving or joining your household,
children reaching the age of 18 even if they are still at school,
college or university, a person no longer being in one of the
discount groups, for example a student finishing their course
of study, or the property becoming occupied.
Failure to tell us within 21 days of a change without good
reason, may mean that you are liable for a £70.00 penalty.
This can be increased to £280.00 for repeated failures.
If you are receiving sole occupancy discount it is essential that
you let us know if your circumstances change and you are no
longer entitled to it.
The phrase 'sole occupancy discount' leaps out at one, since of course there is no such thing, but the Audit Commission appears to have instructed a barrister in late 2007 on the basis that there was, and on the basis that an auditor could tell by looking at the electoral register that there was probably lack of entitlement. Indeed, that is more or less the story which the NFI team's internal minutes tell.
Whatever, the true story, it is clear that the model letter allegedly supplied to the Commission by Hillingdon misrepresents the legal situation and strongly suggests that somebody in Hillingdon is misinterpreting personal data in a significantly incorrect manner.
On the face of it, then, it would appear that the Audit Commission is taking advice from a council which cannot even provide to its customers clear, fair and accurate information as required under its general duty of care and when a law is quite clear and specific about what it must tell them.
This opens up the interesting possibility that the rest of the incorrect material that the Audit Commission has published since 2006 on this matter also originates with Hillingdon.
And indeed the early Audit Guides produced by the Audit Commission actually thank Hillingdon for showing them the way.
But of course the Audit Commission really ought to have checked their fact first.
fraud?
It took a long time to obtain a version of the Audit Commission's Audit Guide on Section 11 Discounts.*
I suspected it would probably be prejudicial and incorrect; so much of their material had been incorrect that it seemed unlikely that any document would get it right.
But the sheer scale of their incompetence and effrontery still came as a shock.
Why, why, why didn't even one local council put its head over the parapet and say 'Excuse me, you are making us pay for this processing, you are using the personal data of our customers to do it, and you are getting it wrong?'
Maybe nobody who read it was well enough trained to know the difference?
Maybe cost cutting has meant that councils employ any old dogsbodies to investigate, dogsbodies who simply assume that the Audit Commission gets it right? People whose background is in benefits and who assume that discounts work like benefits. If you make the assumption that this happened way back at the outset, when the pilots were conducted, a lot of the mistakes make sense, as does the use of inappropriate language from other legal contexts including 'awarded' and 'review'.
I am reminded of the loyal old horse in 'Animal Farm': if Napoleon says it is right it must be right.
Except the metaphorical pig in this case is the Audit Commission.
Too many animals! Enough!
* By this I mean, very generally, the guidance on what it means if more than one person is on the electoral register for an address where a Section 11 discount has been deducted. It means surprisingly little, and is in fact a perfectly legal and regular situation!
I suspected it would probably be prejudicial and incorrect; so much of their material had been incorrect that it seemed unlikely that any document would get it right.
But the sheer scale of their incompetence and effrontery still came as a shock.
Why, why, why didn't even one local council put its head over the parapet and say 'Excuse me, you are making us pay for this processing, you are using the personal data of our customers to do it, and you are getting it wrong?'
Maybe nobody who read it was well enough trained to know the difference?
Maybe cost cutting has meant that councils employ any old dogsbodies to investigate, dogsbodies who simply assume that the Audit Commission gets it right? People whose background is in benefits and who assume that discounts work like benefits. If you make the assumption that this happened way back at the outset, when the pilots were conducted, a lot of the mistakes make sense, as does the use of inappropriate language from other legal contexts including 'awarded' and 'review'.
I am reminded of the loyal old horse in 'Animal Farm': if Napoleon says it is right it must be right.
Except the metaphorical pig in this case is the Audit Commission.
Too many animals! Enough!
* By this I mean, very generally, the guidance on what it means if more than one person is on the electoral register for an address where a Section 11 discount has been deducted. It means surprisingly little, and is in fact a perfectly legal and regular situation!
Saturday, 4 June 2011
Audit Commission data matching
It is not true that the Audit Commission matches data only to show up inconsistent situations. This is partly because it does not also understand the legal frameworks sufficiently well to realise that a situation is not inconsistent but perfectly legal. But it is also the case that it denies that any such requirement exists.
What amuses me is the way that it introduced a Code to Scotland from which almost every single protection for privacy had been removed, and told the Scottish Parliament that the new Code brought things into line with England. Whether anybody in Scotland knew or cared that this was not the whole truth, and nothing much like the truth is another question.
But the Scottish Parliament was treated to all the usual examples of data matching showing up prima facie inconsistent situations. Do they cross their fingers behind their backs when they come out with this?
And of course there was lots of consultation, except consultation of the people whose right to live in peace without being subjected to an abortive fraud investigation was going down the pan.
These consultations about 'sharing' our data never consult us!
What amuses me is the way that it introduced a Code to Scotland from which almost every single protection for privacy had been removed, and told the Scottish Parliament that the new Code brought things into line with England. Whether anybody in Scotland knew or cared that this was not the whole truth, and nothing much like the truth is another question.
But the Scottish Parliament was treated to all the usual examples of data matching showing up prima facie inconsistent situations. Do they cross their fingers behind their backs when they come out with this?
And of course there was lots of consultation, except consultation of the people whose right to live in peace without being subjected to an abortive fraud investigation was going down the pan.
These consultations about 'sharing' our data never consult us!
Audit Commission admits legal cock up. 'To what extent, if at all, should this advice be passed to clients?
This is a copy of the internal document dated February 2009 in which the Audit Commission legal department begins to realise that the information it has published is unfair and incorrect.
The author of this document is crystal clear that the complainant is right, that their report could more accurately reflect the legislation. Later, in a move Sir Humphrey would have admired, they changed their stance, claiming that the report was not 'inaccurate' - just incomplete.
So, it's not incorrect to say that two and two = five: it's just that in all observed instances they = 4.
Though it could be done more thoroughly, the author disposes of the myth that this data comparison shows false or inconsistent 'claims'. This false belief is one of the more common reasons people imagine that a fraud investigation is justified. If people are making a false 'claim', the thinking goes, then something must be wrong.
The Audit Commission later decided that this point was 'merely pedantic', that nothing turned upon it, and that people who used the word 'claim' should not complain when it used the word.
But what it failed to disclose was that its pop ups prejudicially - if not actionably - asserted that identifiable individuals were making two inconsistent claims simultaneously.
This appears to be yet another example of what its ICR calls conduct giving an 'unintentional impression of duplicity'. I am struggling to believe that the duplicity is unintentional, though the impression of it may well be. Alternatively, since it is more or less a wholly unaccountable body, it probably just couldn't give a proverbial one way or the other.
As it said on the matter of ultra vires (on its own account) activities: it's not unusual and there is nothing to stop it.
What this document does is
a) set out the main legal frameworks governing council tax discount law
b) prove that the Audit Commission has been publishing incorrect and prejudicial information as a result of which people are regarded as potential thieves and as being in situations which warrant investigation when in fact there is nothing in the situation which warrants investigation.
What it does not do is consider the Statutory Code of Data Matching Practice.
It may be that by carrying out hundreds of thousands of abortive investigations you do in some sense assist in the prevention and detection of fraud. But the fact that in some vague sense, and ignoring all the damage, misinformation, bullying of and lying about innocent entitled people that goes on, some fraud is prevented is surely not enough to make the project legal and proportionate.
And indeed, on the account of the Audit Commission itself the matters relating to human rights raised in the Robertson judgments are 'still live'. So the Commission itself knows that this is an issue.
In order to comply with the legal framework governing all NFI data matching, the processing should be designed to show up inconsistencies requiring investigation. The aim of data matching is, according to the Code, to identify 'inconsistencies', and not to allow some puffed up bureaucrats to sit in their offices saying 'He might be a thief. He might be worth investigating. Oooh, let's investigate them.'
I have highlighted some of the more important points in red. Comments are in blue.
To: XXXXX XXXXXXX
cc XXXXX XXXX
Date: 24th February 2009
Advice on council tax discounts and fraud in the context of data matching
powers
1.
Correspondence received by the complaints unit at the Commission from
XXXXX has raised a number of questions as to how entitlement to
council tax discount on the basis of being the only resident of a dwelling who
does not fall to be disregarded for the purposes of the discount (which we
shall call single person discount) works.
This is in the context of the Commission’s powers to conduct data matching exercises
under section 32A of the Audit Commission Act (“the 1998 Act”),
which can only be exercised for the purpose of assisting in the prevention and detection of fraud.
It is necessary to determine whether being in false receipt of a single person
discount can amount to fraud, in order to establish whether data matching for
the purposes of determining whether a person is falsely in receipt of a single
person discount is within the Commission’s powers under section 32A of the
1998 Act. (NB Here the lawyer puts the cart before the horse: as she realises midway through the document this comparison does not show that a person is 'falsely in receipt of a single person discount'. Indeed, her own material demonstrates that there is no such thing in the law as a 'single person discount' as this term is often misunderstood. Check her introduction. Read the definition. )
I will set out the statutory background to single person discount in
the following section for reference.
The statutory background re: entitlement to single person discount
The Local Government Finance Act 1992
2.
The Local Government Finance Act 1992 (“the 1992 Act”) provides the power
for “billing authorities” (in England meaning district councils in the main and in
this note referred to as “authorities”) to levy and collect council tax in respect
of those dwellings in their area which are subject to the tax (“chargeable
dwellings”) and sets out how the tax will work (both in the Act itself and by
providing the power for certain further provisions to be made in secondary
legislation made under the Act).
3.
Section 10 sets out how the basic amount of council tax payable by a person
who is liable to pay council tax in respect of a chargeable dwelling is to be
calculated. Section 11(1) then states:
“(1) The amount of council tax payable in respect of any chargeable dwelling
and any day shall be subject to a discount equal to the appropriate
percentage of that amount if on that day-
(a) there is only one resident of the dwelling and he does not fall to be
disregarded for the purposes of the discount; or
(b) there are two or more residents of the dwelling and each of them
except one falls to be disregarded for those purposes.”.
The “appropriate percentage” is set by section 11(3) as 25% and Schedule 1
to the 1992 Act sets out who shall be disregarded for the purposes of the
discount. Categories of those to be disregarded for the purposes of the
discount include students, hospital patients and the severely mentally
impaired.
4.
Paragraph 4(2) of Schedule 2 to the 1992 Act provides that regulations under
Schedule 2 may include provision that, before making any calculation of the
chargeable amount of council tax for the purposes of regulations made under
the Schedule, the authority shall take reasonable steps to ascertain whether
that amount is subject to any discount, and if so, the amount of that discount.
Paragraph 4(3) provides that the regulations may include provision that (a)
where (having taken such steps) the authority has no reason to believe that
the chargeable amount is subject to a discount, it shall assume, in making
any calculation of the chargeable amount for the purposes of regulations
under the Schedule, that the chargeable amount is not subject to any
discount; and (b) where (having taken such steps) the authority has reason to
believe that the chargeable amount is subject to a discount of a particular
amount, it shall assume, in making any such calculation, that the chargeable
amount is subject to a discount of that amount.
5.
Paragraph 4 goes on to provide, in sub-paragraph (4) that regulations may
include provision that the authority must inform the person who is or will be
liable to pay the chargeable amount of the assumption in paragraph 4(3).
Sub-paragraph (5) provides that the regulations may include provision that
where
(a) in accordance with paragraph 4(4), the authority informs the person
concerned that it has assumed that the chargeable amount is subject to a
discount of a particular amount; and
(b) at any time before the end of the financial year concerned, the person has
reason to believe that the chargeable amount is not in fact subject to any
discount, or is subject to a discount of a smaller amount,
the person shall, within such period as may be prescribed, notify the authority
of his belief.
6.
Section 14(2) of the 1992 Act states that Schedule 3 to the 1992 Act shall
have effect and paragraph 2 of Schedule 3 states-
“In any case where
(a) a person is required by any provision included in regulations under
paragraph 4….of Schedule 2 to this Act to notify a billing authority;
and
(b) he fails without reasonable excuse to notify the authority in
accordance with the provision,
the authority may impose a penalty of £70 upon him.”.
The Council Tax (Administration and Enforcement) Regulations 1992 (S.I.
1992/613, as amended)
7.
These Regulations (“the 1992 Regulations”) are made under the 1992 Act.
The effect of regulation 3 (the power for the making of which is derived from
paragraph 2(3) of Schedule 2 to the 1992 Act) is that a person whom an
authority thinks is a resident, owner or managing agent of a particular
dwelling must supply to the authority information which is in that person’s
control or possession, which is requested in writing from the person by the
authority, and is so requested for the purposes of identifying the person who,
in respect of any period specified in the notice, is the liable person in relation
to the dwelling. Under paragraph 1(1) of Schedule 3 to the 1992 Act, a failure
to provide the information, or the provision of information which the person
knows is inaccurate in any material particular, will lead to the authority having
the power to impose a penalty of £70.
8.
Regulation 14 provides that before making any calculation for the purposes of
Part V of the Regulations of the chargeable amount in respect of any dwelling
in its area, an authority shall take reasonable steps to ascertain whether that
amount is subject to a discount, and if so, the amount of that discount.
Regulation 15 provides that where having taken those reasonable steps (1)
an authority has no reason to believe that the chargeable amount for the
financial year concerned is subject to a discount, it shall assume, in making
any calculation of the chargeable amount, that the chargeable amount is not
subject to the discount; and (2) an authority has reason to believe that the
chargeable amount for the financial year concerned is subject to a discount of
a particular amount, it shall assume, in making the calculation of the
chargeable amount, that the chargeable amount is subject to a discount of
that amount.
9.
Regulation 16 goes on to provide that where a person-
(a) has been informed in accordance with any provision of demand notice
regulations [as to which see paragraph 12 below] of an assumption as
to discount made in his case; and
(b) at any time before the end of the financial year following the financial
year in respect of which the assumption is made has reason to believe
that the chargeable amount is not in fact subject to any discount, or is
subject to a discount of a smaller amount,
he shall, within the period of 21 days beginning on the day on which he first
has reason so to believe, notify the authority in writing of his belief.
10. If persons are jointly and severally liable to pay council tax in respect of a
particular dwelling in the period concerned, the duty above applies to each of
them but is discharged if one of them makes the relevant notification.
11. A demand notice is a written notice that an authority must serve for each
financial year on every person liable to pay council tax under regulation 18, in
accordance with regulations 19-21.
Under regulation 20, the demand notice shall require the making of payments of the
authority’s estimate of the chargeable amount made, as respects part or whole of the relevant year,
on various assumptions, including in regulation 20(3)(e) that if, by virtue of
regulation 15(1), the chargeable amount is assumed not to be subject to a
discount on the day the notice is issued, that it will not be subject to a
discount as regards any day after the issue of the notice; and in 20(3)(f) that
if, by virtue of regulation 15(2), the chargeable amount is assumed to be
subject to a discount on the day the notice is issued, that it will continue to be
subject to the same rate of discount as regards every day after the issue of
the notice.
The Council Tax and Non-Domestic Rating (Demand Notices)(England)
Regulations 2003 (S.I. 2003/2613, as amended)
12. Regulation 3(1) of these Regulations (“the 2003 Regulations”) provides that a
council tax demand notice shall contain the matters specified in Schedule 1.
Under paragraphs 16 and 17 of Schedule 1, these matters shall include the
days (if any) when the amount payable under the notice was calculated by
reference to section 11 of the 1992 Act; the reasons for the discount and its
amount; a statement that if at any time before the end of the following year
the person to whom the notice is issued has reason to believe that the
amount of council tax payable is not subject to any discount or is subject to a
lesser discount, he must notify the authority of his belief within a period of 21
days beginning on the day on which he first had that belief; and a statement
that if the person fails without reasonable excuse to comply with that
notification requirement, the authority may impose on him the penalty which is
specified in paragraph 1(2) of Schedule 3 to the 1992 Act.
Summary of the position in relation to single person discount under the
above mentioned enactments
13. A council is under a duty to take reasonable steps to ascertain whether a
single person discount is applicable in respect of a particular chargeable
dwelling.
What is “reasonable” will be construed in accordance with the usual
public law principles but it is clear from XXXXX XXXXX’s correspondence that
councils have not interpreted this to mean that they must seek information
from persons at every chargeable dwelling before every financial year as to
whether they are entitled to single person discount. This does not appear to
me to be “unreasonable” in view of the expense and time that would be
involved in carrying out such an annual check.
Instead, it appears that councils rely on regulations 15(1) and (2) of the 1992 Regulations
to make an assumption, presumably based on the previous financial year’s entitlements
(where they have not been made aware of a change in entitlement to the
discount), that the chargeable amount in relation to a chargeable dwelling is
either subject to or is not subject to a single person discount. They also rely
on regulation 20(3) to make an assumption in the demand notice that the
state of affairs that pertains in relation to the entitlement to a single person
discount in respect of a chargeable dwelling on the day the notice is issued
will pertain for the remainder of the financial year.
(NB It is not correct to state that councils 'rely' on these regs to make the assumption outlined here: the legal assumptions are not optional, or something that can be relied on, they are compulsory steps in the administration of the tax. This is the central point about them which, due to the focus of the author, is missed in this analysis. It would appear that the council chooses 'steps' which do not involve writing to the taxpayer, but what these may be are obviously not particularly clear to the Audit Commission. Having then decided, as a result of these steps, that there is entitlement to a discount of a particular amount, the council then must make the assumptions set down in the regs, which are 'assumptions as to the future'. This makes it all the less acceptable for the Audit Commission to write letters making assertions about the 'beliefs' of council officers, as it has done, asserting that these officers hold 'beliefs' which would be inconsistent with their legal duties. )
14. However, under regulation 16 of the 1992 Regulations, there is a clear duty
on a person who has been informed in a demand notice (as he should be
pursuant to the 2003 Regulations) of an assumption as to single person
discount made in his case, to inform the authority if he has reason to believe that entitlement to the discount or to the level of discount has changed within
21 days of him first having such a reason to believe. A failure to do this,
without reasonable excuse, allows the authority to impose a penalty of £70.
(NB 'The discount' here means the sum in question at the rate of 25%)
15. It is also clear that, under regulation 3 of the 1992 Regulations, a person
whom an authority thinks is the resident, owner or managing agent in respect
of a chargeable dwelling must supply any information he has to that authority
when requested to do so in writing by the authority where the purpose of the
request is to identify the person who is the liable person in respect of the
dwelling. This would allow a council to request information at any point during
the year from the relevant person for the purpose of establishing who the
liable person for a chargeable dwelling is and that person would be under a
duty to comply (and may be subject to a penalty if he does not).
(NB The Audit Commission has made some rather broad claims about the situation in which the council may demand information under the 'guise' of using regulation 3, based on its own suspicion that if a person is on the electoral register and not on council tax data sets a sexual/live in relationship is likely.)
Fraud
16. The next question we need to consider is whether a false claim as to
entitlement to single person discount or a failure to comply with the duty
under regulations 3 or 16 of the 1992 Regulations amounts to fraud.
17. Section 1 of the Fraud Act 2006 provides that a person is guilty of fraud if he
is in breach of one of the listed sections, which include section 2 and 3.
Section 2 provides that a person is in breach of the section if he dishonestly
makes a false representation and intends by making the representation to
make a gain for himself or another or to cause loss to another or expose
another to risk of loss.
A representation is false if it is untrue or misleading and the person making it knows that it is, or might be, untrue or misleading, and a representation means any representation as to fact or law. The current
meaning of dishonesty was established by R v Ghosh 1982 which set a 2 stage test.
The first question is whether a defendant’s behaviour would be
regarded as dishonest by the ordinary standards of reasonable and honest
people. If answered in the affirmative, the second question is whether the
defendant was aware that his conduct was dishonest and would be regarded
as dishonest by reasonable and honest people.
18. If a person provides a council with information that he is the only adult
resident in a chargeable dwelling (or the only adult who does not fall to be
disregarded for the purposes of the discount) and that information is false and
known to be false by that person, if he does so dishonestly and if he intends
by providing that information to make a gain for himself (i.e. by receiving
single person discount to which he is not entitled so as to reduce his council
tax bill), then he will be guilty of fraud.
(This is why it is so wrong of the Audit Commission persistently to imply that people on its hit lists are literally claiming to live alone.)
19. Section 3 of the Fraud Act 2006 provides that a person is in breach of the
section if he dishonestly fails to disclose to another person information which
he is under a legal duty to disclose and intends by failing to disclose the
information to make a gain for himself or another or to cause loss to another
or expose another to a risk of loss. If a person dishonestly (as per the
meaning set out in paragraph 17 above) fails to disclose information in
compliance with regulations 3 or 16 of the 1992 Regulations and he intends
by the failure to disclose this information to make a gain for himself (i.e. by
receiving single person discount to which he is not entitled so as to reduce his
council tax bill), then it seems he will be guilty of fraud.
20. Given that, on the above analysis, it is possible for a person to be fraudulently
receiving single person discount, the Commission has the power to conduct a
data matching exercise for the purpose of assisting in the prevention and
detection of persons who are receiving single person discount but are not
entitled to so receive it.
(This is a very contentious assertion. It all depends upon what you mean by 'data matching')
Website material identified by XXXXX XXXXX as inaccurate
21. XXXXX XXXXX identified paragraphs 42 and 47 of the NFI 2006/07 national
report under the section “Other data matching” as inaccurate. I have looked at
all of section 3 (paragraphs 42-51) and I agree that the content of paragraphs
42 and 47 could more accurately reflect the legislation.
I attach a link to the report here
http://www.audit-commission.gov.uk/Products/NATIONALREPORT/
A3F1CBB1-C859-4bb1-82CD-B8A088FAAA07/NFI200607nationalreport.
pdf.
Given this is a 2006/7 report, I am not sure whether
making changes to it is feasible but my suggestions may inform further
versions or further NFI documents. For ease of reference, I will set out the
paragraphs as they appear in the 2006/7 report below with my suggested
track changes (and reasons for them).
22. Paragraph 42: The amount of council tax payable by a person in respect of a
chargeable dwelling will be set by reference to the area and valuation band in
which the dwelling falls.[DN there is nothing apparent in the legislation which
bases the tax on the number of persons in a dwelling- this point was raised by
XXXXX XXXXX and so I have substituted the first sentence.]
Deleted: A full council tax bill assumes that there are two
adults living in a property
If only one adult lives in the property [Deleted: they can claim.
DN entitlement may arise via council’s assumption rather than a claim by
the person, hence the change of wording here No, entitlement arises as a result of the conditions laid down in the law applying, and not via assumption. A small slip, perhaps, but worth pointing out.]
(who does not fall to be disregarded for the purposes of
the discount) or there are 2 or more adults but only 1 of these does not fall to
be disregarded for the purposes of the discount, there will be an entitlement
to [] a council tax single persons discount of 25 per cent.
Nationally these discounts are being received by over
7 million householders, costing councils over £2 billion each year.
It really is annoying the way this discount is persistently represented as costing councils money when single people cost councils less to provide services for than dwellings in multiple occupation.
23. Paragraph 47: Also within this exercise is a “Rising 18s” match which
identifies young people becoming an adult at 18 who live with a council tax
single person discount recipient. (Deleted: As t) This age change could make many
recipients of the single person discount ineligible as they will not then be the
only adult living in the property (although it is important to bear in mind that a
recipient will only become ineligible in these circumstances where the person
turning 18 will not fall to be disregarded for the purposes of the discount) [DN
XXXXX XXXXX raised the point that no mention was made of disregards here
and I agree that this is less than ideal bearing in mind that many people on
turning 18 will be disregarded for the purposes of the discount due to being
students]. By identifying such cases, the Rising 18s match will enable
councils to address this risk at an early stage.
In this case how can there possible be an inconsistency requiring investigation?
24. I have not looked in detail at the other publications on the NFI section of the
Commission website but am happy to do this and check for inaccuracies if
necessary.
25. I have addressed this minute to you as I thought it was useful to set out the
statutory scheme and so on in detail for future reference. Please let me know,
however, to what extent (if at all) you want this advice to be passed to clients.
Happy to discuss
Leah Griffiths
Solicitor
Corporate Services (Legal)
Audit Commission
The author of this document is crystal clear that the complainant is right, that their report could more accurately reflect the legislation. Later, in a move Sir Humphrey would have admired, they changed their stance, claiming that the report was not 'inaccurate' - just incomplete.
So, it's not incorrect to say that two and two = five: it's just that in all observed instances they = 4.
Though it could be done more thoroughly, the author disposes of the myth that this data comparison shows false or inconsistent 'claims'. This false belief is one of the more common reasons people imagine that a fraud investigation is justified. If people are making a false 'claim', the thinking goes, then something must be wrong.
The Audit Commission later decided that this point was 'merely pedantic', that nothing turned upon it, and that people who used the word 'claim' should not complain when it used the word.
But what it failed to disclose was that its pop ups prejudicially - if not actionably - asserted that identifiable individuals were making two inconsistent claims simultaneously.
This appears to be yet another example of what its ICR calls conduct giving an 'unintentional impression of duplicity'. I am struggling to believe that the duplicity is unintentional, though the impression of it may well be. Alternatively, since it is more or less a wholly unaccountable body, it probably just couldn't give a proverbial one way or the other.
As it said on the matter of ultra vires (on its own account) activities: it's not unusual and there is nothing to stop it.
What this document does is
a) set out the main legal frameworks governing council tax discount law
b) prove that the Audit Commission has been publishing incorrect and prejudicial information as a result of which people are regarded as potential thieves and as being in situations which warrant investigation when in fact there is nothing in the situation which warrants investigation.
What it does not do is consider the Statutory Code of Data Matching Practice.
It may be that by carrying out hundreds of thousands of abortive investigations you do in some sense assist in the prevention and detection of fraud. But the fact that in some vague sense, and ignoring all the damage, misinformation, bullying of and lying about innocent entitled people that goes on, some fraud is prevented is surely not enough to make the project legal and proportionate.
And indeed, on the account of the Audit Commission itself the matters relating to human rights raised in the Robertson judgments are 'still live'. So the Commission itself knows that this is an issue.
In order to comply with the legal framework governing all NFI data matching, the processing should be designed to show up inconsistencies requiring investigation. The aim of data matching is, according to the Code, to identify 'inconsistencies', and not to allow some puffed up bureaucrats to sit in their offices saying 'He might be a thief. He might be worth investigating. Oooh, let's investigate them.'
I have highlighted some of the more important points in red. Comments are in blue.
To: XXXXX XXXXXXX
cc XXXXX XXXX
Date: 24th February 2009
Advice on council tax discounts and fraud in the context of data matching
powers
1.
Correspondence received by the complaints unit at the Commission from
XXXXX has raised a number of questions as to how entitlement to
council tax discount on the basis of being the only resident of a dwelling who
does not fall to be disregarded for the purposes of the discount (which we
shall call single person discount) works.
This is in the context of the Commission’s powers to conduct data matching exercises
under section 32A of the Audit Commission Act (“the 1998 Act”),
which can only be exercised for the purpose of assisting in the prevention and detection of fraud.
It is necessary to determine whether being in false receipt of a single person
discount can amount to fraud, in order to establish whether data matching for
the purposes of determining whether a person is falsely in receipt of a single
person discount is within the Commission’s powers under section 32A of the
1998 Act. (NB Here the lawyer puts the cart before the horse: as she realises midway through the document this comparison does not show that a person is 'falsely in receipt of a single person discount'. Indeed, her own material demonstrates that there is no such thing in the law as a 'single person discount' as this term is often misunderstood. Check her introduction. Read the definition. )
I will set out the statutory background to single person discount in
the following section for reference.
The statutory background re: entitlement to single person discount
The Local Government Finance Act 1992
2.
The Local Government Finance Act 1992 (“the 1992 Act”) provides the power
for “billing authorities” (in England meaning district councils in the main and in
this note referred to as “authorities”) to levy and collect council tax in respect
of those dwellings in their area which are subject to the tax (“chargeable
dwellings”) and sets out how the tax will work (both in the Act itself and by
providing the power for certain further provisions to be made in secondary
legislation made under the Act).
3.
Section 10 sets out how the basic amount of council tax payable by a person
who is liable to pay council tax in respect of a chargeable dwelling is to be
calculated. Section 11(1) then states:
“(1) The amount of council tax payable in respect of any chargeable dwelling
and any day shall be subject to a discount equal to the appropriate
percentage of that amount if on that day-
(a) there is only one resident of the dwelling and he does not fall to be
disregarded for the purposes of the discount; or
(b) there are two or more residents of the dwelling and each of them
except one falls to be disregarded for those purposes.”.
The “appropriate percentage” is set by section 11(3) as 25% and Schedule 1
to the 1992 Act sets out who shall be disregarded for the purposes of the
discount. Categories of those to be disregarded for the purposes of the
discount include students, hospital patients and the severely mentally
impaired.
4.
Paragraph 4(2) of Schedule 2 to the 1992 Act provides that regulations under
Schedule 2 may include provision that, before making any calculation of the
chargeable amount of council tax for the purposes of regulations made under
the Schedule, the authority shall take reasonable steps to ascertain whether
that amount is subject to any discount, and if so, the amount of that discount.
Paragraph 4(3) provides that the regulations may include provision that (a)
where (having taken such steps) the authority has no reason to believe that
the chargeable amount is subject to a discount, it shall assume, in making
any calculation of the chargeable amount for the purposes of regulations
under the Schedule, that the chargeable amount is not subject to any
discount; and (b) where (having taken such steps) the authority has reason to
believe that the chargeable amount is subject to a discount of a particular
amount, it shall assume, in making any such calculation, that the chargeable
amount is subject to a discount of that amount.
5.
Paragraph 4 goes on to provide, in sub-paragraph (4) that regulations may
include provision that the authority must inform the person who is or will be
liable to pay the chargeable amount of the assumption in paragraph 4(3).
Sub-paragraph (5) provides that the regulations may include provision that
where
(a) in accordance with paragraph 4(4), the authority informs the person
concerned that it has assumed that the chargeable amount is subject to a
discount of a particular amount; and
(b) at any time before the end of the financial year concerned, the person has
reason to believe that the chargeable amount is not in fact subject to any
discount, or is subject to a discount of a smaller amount,
the person shall, within such period as may be prescribed, notify the authority
of his belief.
6.
Section 14(2) of the 1992 Act states that Schedule 3 to the 1992 Act shall
have effect and paragraph 2 of Schedule 3 states-
“In any case where
(a) a person is required by any provision included in regulations under
paragraph 4….of Schedule 2 to this Act to notify a billing authority;
and
(b) he fails without reasonable excuse to notify the authority in
accordance with the provision,
the authority may impose a penalty of £70 upon him.”.
The Council Tax (Administration and Enforcement) Regulations 1992 (S.I.
1992/613, as amended)
7.
These Regulations (“the 1992 Regulations”) are made under the 1992 Act.
The effect of regulation 3 (the power for the making of which is derived from
paragraph 2(3) of Schedule 2 to the 1992 Act) is that a person whom an
authority thinks is a resident, owner or managing agent of a particular
dwelling must supply to the authority information which is in that person’s
control or possession, which is requested in writing from the person by the
authority, and is so requested for the purposes of identifying the person who,
in respect of any period specified in the notice, is the liable person in relation
to the dwelling. Under paragraph 1(1) of Schedule 3 to the 1992 Act, a failure
to provide the information, or the provision of information which the person
knows is inaccurate in any material particular, will lead to the authority having
the power to impose a penalty of £70.
8.
Regulation 14 provides that before making any calculation for the purposes of
Part V of the Regulations of the chargeable amount in respect of any dwelling
in its area, an authority shall take reasonable steps to ascertain whether that
amount is subject to a discount, and if so, the amount of that discount.
Regulation 15 provides that where having taken those reasonable steps (1)
an authority has no reason to believe that the chargeable amount for the
financial year concerned is subject to a discount, it shall assume, in making
any calculation of the chargeable amount, that the chargeable amount is not
subject to the discount; and (2) an authority has reason to believe that the
chargeable amount for the financial year concerned is subject to a discount of
a particular amount, it shall assume, in making the calculation of the
chargeable amount, that the chargeable amount is subject to a discount of
that amount.
9.
Regulation 16 goes on to provide that where a person-
(a) has been informed in accordance with any provision of demand notice
regulations [as to which see paragraph 12 below] of an assumption as
to discount made in his case; and
(b) at any time before the end of the financial year following the financial
year in respect of which the assumption is made has reason to believe
that the chargeable amount is not in fact subject to any discount, or is
subject to a discount of a smaller amount,
he shall, within the period of 21 days beginning on the day on which he first
has reason so to believe, notify the authority in writing of his belief.
10. If persons are jointly and severally liable to pay council tax in respect of a
particular dwelling in the period concerned, the duty above applies to each of
them but is discharged if one of them makes the relevant notification.
11. A demand notice is a written notice that an authority must serve for each
financial year on every person liable to pay council tax under regulation 18, in
accordance with regulations 19-21.
Under regulation 20, the demand notice shall require the making of payments of the
authority’s estimate of the chargeable amount made, as respects part or whole of the relevant year,
on various assumptions, including in regulation 20(3)(e) that if, by virtue of
regulation 15(1), the chargeable amount is assumed not to be subject to a
discount on the day the notice is issued, that it will not be subject to a
discount as regards any day after the issue of the notice; and in 20(3)(f) that
if, by virtue of regulation 15(2), the chargeable amount is assumed to be
subject to a discount on the day the notice is issued, that it will continue to be
subject to the same rate of discount as regards every day after the issue of
the notice.
The Council Tax and Non-Domestic Rating (Demand Notices)(England)
Regulations 2003 (S.I. 2003/2613, as amended)
12. Regulation 3(1) of these Regulations (“the 2003 Regulations”) provides that a
council tax demand notice shall contain the matters specified in Schedule 1.
Under paragraphs 16 and 17 of Schedule 1, these matters shall include the
days (if any) when the amount payable under the notice was calculated by
reference to section 11 of the 1992 Act; the reasons for the discount and its
amount; a statement that if at any time before the end of the following year
the person to whom the notice is issued has reason to believe that the
amount of council tax payable is not subject to any discount or is subject to a
lesser discount, he must notify the authority of his belief within a period of 21
days beginning on the day on which he first had that belief; and a statement
that if the person fails without reasonable excuse to comply with that
notification requirement, the authority may impose on him the penalty which is
specified in paragraph 1(2) of Schedule 3 to the 1992 Act.
Summary of the position in relation to single person discount under the
above mentioned enactments
13. A council is under a duty to take reasonable steps to ascertain whether a
single person discount is applicable in respect of a particular chargeable
dwelling.
What is “reasonable” will be construed in accordance with the usual
public law principles but it is clear from XXXXX XXXXX’s correspondence that
councils have not interpreted this to mean that they must seek information
from persons at every chargeable dwelling before every financial year as to
whether they are entitled to single person discount. This does not appear to
me to be “unreasonable” in view of the expense and time that would be
involved in carrying out such an annual check.
Instead, it appears that councils rely on regulations 15(1) and (2) of the 1992 Regulations
to make an assumption, presumably based on the previous financial year’s entitlements
(where they have not been made aware of a change in entitlement to the
discount), that the chargeable amount in relation to a chargeable dwelling is
either subject to or is not subject to a single person discount. They also rely
on regulation 20(3) to make an assumption in the demand notice that the
state of affairs that pertains in relation to the entitlement to a single person
discount in respect of a chargeable dwelling on the day the notice is issued
will pertain for the remainder of the financial year.
(NB It is not correct to state that councils 'rely' on these regs to make the assumption outlined here: the legal assumptions are not optional, or something that can be relied on, they are compulsory steps in the administration of the tax. This is the central point about them which, due to the focus of the author, is missed in this analysis. It would appear that the council chooses 'steps' which do not involve writing to the taxpayer, but what these may be are obviously not particularly clear to the Audit Commission. Having then decided, as a result of these steps, that there is entitlement to a discount of a particular amount, the council then must make the assumptions set down in the regs, which are 'assumptions as to the future'. This makes it all the less acceptable for the Audit Commission to write letters making assertions about the 'beliefs' of council officers, as it has done, asserting that these officers hold 'beliefs' which would be inconsistent with their legal duties. )
14. However, under regulation 16 of the 1992 Regulations, there is a clear duty
on a person who has been informed in a demand notice (as he should be
pursuant to the 2003 Regulations) of an assumption as to single person
discount made in his case, to inform the authority if he has reason to believe that entitlement to the discount or to the level of discount has changed within
21 days of him first having such a reason to believe. A failure to do this,
without reasonable excuse, allows the authority to impose a penalty of £70.
(NB 'The discount' here means the sum in question at the rate of 25%)
15. It is also clear that, under regulation 3 of the 1992 Regulations, a person
whom an authority thinks is the resident, owner or managing agent in respect
of a chargeable dwelling must supply any information he has to that authority
when requested to do so in writing by the authority where the purpose of the
request is to identify the person who is the liable person in respect of the
dwelling. This would allow a council to request information at any point during
the year from the relevant person for the purpose of establishing who the
liable person for a chargeable dwelling is and that person would be under a
duty to comply (and may be subject to a penalty if he does not).
(NB The Audit Commission has made some rather broad claims about the situation in which the council may demand information under the 'guise' of using regulation 3, based on its own suspicion that if a person is on the electoral register and not on council tax data sets a sexual/live in relationship is likely.)
Fraud
16. The next question we need to consider is whether a false claim as to
entitlement to single person discount or a failure to comply with the duty
under regulations 3 or 16 of the 1992 Regulations amounts to fraud.
17. Section 1 of the Fraud Act 2006 provides that a person is guilty of fraud if he
is in breach of one of the listed sections, which include section 2 and 3.
Section 2 provides that a person is in breach of the section if he dishonestly
makes a false representation and intends by making the representation to
make a gain for himself or another or to cause loss to another or expose
another to risk of loss.
A representation is false if it is untrue or misleading and the person making it knows that it is, or might be, untrue or misleading, and a representation means any representation as to fact or law. The current
meaning of dishonesty was established by R v Ghosh 1982 which set a 2 stage test.
The first question is whether a defendant’s behaviour would be
regarded as dishonest by the ordinary standards of reasonable and honest
people. If answered in the affirmative, the second question is whether the
defendant was aware that his conduct was dishonest and would be regarded
as dishonest by reasonable and honest people.
18. If a person provides a council with information that he is the only adult
resident in a chargeable dwelling (or the only adult who does not fall to be
disregarded for the purposes of the discount) and that information is false and
known to be false by that person, if he does so dishonestly and if he intends
by providing that information to make a gain for himself (i.e. by receiving
single person discount to which he is not entitled so as to reduce his council
tax bill), then he will be guilty of fraud.
(This is why it is so wrong of the Audit Commission persistently to imply that people on its hit lists are literally claiming to live alone.)
19. Section 3 of the Fraud Act 2006 provides that a person is in breach of the
section if he dishonestly fails to disclose to another person information which
he is under a legal duty to disclose and intends by failing to disclose the
information to make a gain for himself or another or to cause loss to another
or expose another to a risk of loss. If a person dishonestly (as per the
meaning set out in paragraph 17 above) fails to disclose information in
compliance with regulations 3 or 16 of the 1992 Regulations and he intends
by the failure to disclose this information to make a gain for himself (i.e. by
receiving single person discount to which he is not entitled so as to reduce his
council tax bill), then it seems he will be guilty of fraud.
20. Given that, on the above analysis, it is possible for a person to be fraudulently
receiving single person discount, the Commission has the power to conduct a
data matching exercise for the purpose of assisting in the prevention and
detection of persons who are receiving single person discount but are not
entitled to so receive it.
(This is a very contentious assertion. It all depends upon what you mean by 'data matching')
Website material identified by XXXXX XXXXX as inaccurate
21. XXXXX XXXXX identified paragraphs 42 and 47 of the NFI 2006/07 national
report under the section “Other data matching” as inaccurate. I have looked at
all of section 3 (paragraphs 42-51) and I agree that the content of paragraphs
42 and 47 could more accurately reflect the legislation.
I attach a link to the report here
http://www.audit-commission.gov.uk/Products/NATIONALREPORT/
A3F1CBB1-C859-4bb1-82CD-B8A088FAAA07/NFI200607nationalreport.
pdf.
Given this is a 2006/7 report, I am not sure whether
making changes to it is feasible but my suggestions may inform further
versions or further NFI documents. For ease of reference, I will set out the
paragraphs as they appear in the 2006/7 report below with my suggested
track changes (and reasons for them).
22. Paragraph 42: The amount of council tax payable by a person in respect of a
chargeable dwelling will be set by reference to the area and valuation band in
which the dwelling falls.[DN there is nothing apparent in the legislation which
bases the tax on the number of persons in a dwelling- this point was raised by
XXXXX XXXXX and so I have substituted the first sentence.]
Deleted: A full council tax bill assumes that there are two
adults living in a property
If only one adult lives in the property [Deleted: they can claim.
DN entitlement may arise via council’s assumption rather than a claim by
the person, hence the change of wording here No, entitlement arises as a result of the conditions laid down in the law applying, and not via assumption. A small slip, perhaps, but worth pointing out.]
(who does not fall to be disregarded for the purposes of
the discount) or there are 2 or more adults but only 1 of these does not fall to
be disregarded for the purposes of the discount, there will be an entitlement
to [] a council tax single persons discount of 25 per cent.
Nationally these discounts are being received by over
7 million householders, costing councils over £2 billion each year.
It really is annoying the way this discount is persistently represented as costing councils money when single people cost councils less to provide services for than dwellings in multiple occupation.
23. Paragraph 47: Also within this exercise is a “Rising 18s” match which
identifies young people becoming an adult at 18 who live with a council tax
single person discount recipient. (Deleted: As t) This age change could make many
recipients of the single person discount ineligible as they will not then be the
only adult living in the property (although it is important to bear in mind that a
recipient will only become ineligible in these circumstances where the person
turning 18 will not fall to be disregarded for the purposes of the discount) [DN
XXXXX XXXXX raised the point that no mention was made of disregards here
and I agree that this is less than ideal bearing in mind that many people on
turning 18 will be disregarded for the purposes of the discount due to being
students]. By identifying such cases, the Rising 18s match will enable
councils to address this risk at an early stage.
In this case how can there possible be an inconsistency requiring investigation?
24. I have not looked in detail at the other publications on the NFI section of the
Commission website but am happy to do this and check for inaccuracies if
necessary.
25. I have addressed this minute to you as I thought it was useful to set out the
statutory scheme and so on in detail for future reference. Please let me know,
however, to what extent (if at all) you want this advice to be passed to clients.
Happy to discuss
Leah Griffiths
Solicitor
Corporate Services (Legal)
Audit Commission
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