Millions of pensioners living alone could face higher council tax bills if Housing Minister Angela Rayner scraps the 25% single occupant discount, potentially exacerbating financial pressures as they also face losing winter fuel payments.
The analysis reveals that around half of the 8.4 million people affected by the potential abolition of the single person council tax rebate are pensioners. The rebate currently reduces the average D-level council tax bill by around £543 a year and saves the public purse around £3bn a year, according to the Institute for Fiscal Studies (IFS).
Angela Rayner, who has not ruled out scrapping the rebate this week, has come under fire over the potential impact on older people, many of whom are already struggling with the rising cost of living. The announcement follows Chancellor Rachel Reeves’ decision to test the means of the winter fuel payment, which previously provided up to £300 to around 10 million pensioners, with the aim of saving the Treasury £1.4bn.
Jan Short, general secretary of the National Pensioners’ Congress, criticised the potential abolition of the rebate, calling it an “unforgivable betrayal” of older people that could force them to give up their homes. “Older people, who have no voice in parliament, seem to be seen as easy targets,” she said.
Conservative MP Graham Stewart echoed these concerns in the Commons, highlighting the pressure on pensioners who are losing out on winter fuel payments and council tax rebates. He said: “This means hundreds of pounds are being cut off from those who can’t afford it. We can’t have such an unnecessary impact on pensioners.”
Speaking in the Commons, Rayner confirmed there were no current plans to increase council tax, but she did not pledge to retain the single-person discount. Asked about the issue, she replied: “This government is about making sure workers are better off, and we intend to do that.”
Figures from the Ministry of Housing, Communities and Local Government suggest that around 8.4 million homes in England benefit from the 25% discount for single residents, with an additional 253,000 households eligible because other residents are ignored for council tax purposes. Figures from the Office for National Statistics suggest that half of those living alone are over 65.
The largest number of single-person households eligible for the discount is in Birmingham, where 152,000 people benefit from the tax savings. Other hotspots include retiree-friendly rural areas such as Cornwall, Somerset and North Yorkshire. As the UK population ages, the number of people living alone is rising, with an 8% increase in single-person households over the past decade.
Caroline Abrams, charity director at Age UK, warned that older people living alone already face significant challenges with fixed household costs no lower than those living alone. She said: “If the single person discount on council tax is removed, many pensioners – particularly widows – could find their finances severely strained, especially if they also lose their winter fuel payments.”
A Ministry of Housing spokesman confirmed the government had no current plans to reform council tax, but the potential changes have already raised concerns among pensioner advocacy groups and MPs alike.