Issue - meetings

Notice of Motion - Student Council Tax Gap

“Council notes that:

·         The Student Class N Council Tax exemption is a national policy that helps to support the accommodation costs of full-time students during their studies.

·         It receives some reimbursement from the DCLG via the Settlement Funding Assessment to compensate for the loss of Council Tax income, but that the student adjustment was fixed in 2013/14 and has not been updated since.

·         With the rise in Council Tax rates since 2013/14 and growing student numbers, the current cost of N exemptions within Exeter is estimated to be £10.12m of which £0.8m would be payable to Exeter City Council.

·         In response to a recent parliamentary question, HMG has indicated that they intend to use the consultation on the Fair Funding Review 2.0 to review the adjustments to the funding formula for local authorities with higher student- exempt properties.

Council believes that:

·         The review of the funding formula is a welcome first step, but that local authorities with high student populations, like Exeter, should not disproportionately bear the costs of student Council Tax exemptions. 

Council resolves to:

·         Participate fully in the consultation process on the Fair Funding Review 2.0, making the case for the funding gap caused by Class N exemptions to be filled and that future funding assessments should reflect changes in Council Tax rates and student numbers.

·         Engage with similar authorities and others, locally and nationally, to jointly lobby HMG on this issue.”

Proposer – Cllr Kevin Mitchell

Seconder – Cllr Tammy Palmer

Councillor K Mitchell moved, and Councillor M Mitchell seconded a Notice of Motion in the following terms:

“Council notes that:

The Student Class N Council Tax exemption is a national policy that helps to support the accommodation costs of full-time students during their studies.

It receives some reimbursement from the DCLG via the Settlement Funding Assessment to compensate for the loss of Council Tax income, but that the student adjustment was fixed in 2013/14 and has not been updated since.

With the rise in Council Tax rates since 2013/14 and growing student numbers, the current cost of N exemptions within Exeter is estimated to be £10.12m of which £0.8m would be payable to Exeter City Council.

In response to a recent parliamentary question, HMG has indicated that they intend to use the consultation on the Fair Funding Review 2.0 to review the adjustments to the funding formula for local authorities with higher student- exempt properties.

Council believes that:

The review of the funding formula is a welcome first step, but that local authorities with high student populations, like Exeter, should not disproportionately bear the costs of student Council Tax exemptions.

Council resolves to:

Participate fully in the consultation process on the Fair Funding Review 2.0, making the case for the funding gap caused by Class N exemptions to be filled and that future funding assessments should reflect changes in Council Tax rates and student numbers.

Engage with similar authorities and others, locally and nationally, to jointly lobby HMG on this issue.”

In presenting the motion Councillor K Mitchell made the following points: -

• Exeter had become an attraction for students as the University was a top university in the country; and
• this issue was not anti-student or anti-university.

Councillor M Mitchell, as seconder, spoke in support of the motion, making the following points:

• this was similar to the business rates on PBSA in 2019;
• all councillors in inner city wards had a high density of students;
• arrangements had previously been made in 2013/14 for extra allowance for cities with high numbers of students and Exeter believes we meet the high criteria threshold and would like the system reviewed; and
• as Exeter was a low wage area, this makes council tax a burden for those who are paying.

Following a unanimous vote this motion was CARRIED      .