Rebel Liberal Democrat peers have helped force an amendment to the Local Government Finance Bill, which would force the Government to conduct a review into council tax benefit (CTB) schemes within three years.

Members of the House of Lords last night voted by 203 votes to 165 in favour of the amendment tabled by Labour peer Baroness Hollis – and backed by Liberal Democrat peer Lord Shipley and crossbencher Lord Best.

The vote comes despite the government last week announcing an extra £100m to help ‘encourage best practice' among authorities designing individual benefit schemes ahead of implementation next April.

Lord Shipley, who led 16 Liberal Democrat peers in voting for the amendment said ‘the problems for individuals could be very severe in the face of so much change at once'. ‘As a very minimum the Government should commission an independent review to report on how the changes are working,' said Lord Shipley.

Warning localised CTB schemes risk ‘poll tax mark two', Baroness Hollis said the amendment seeking a review of the initiative was ‘a modest one' which would show whether the benefit reform was sturdy and robust.

‘If it is not and needs adjustment a review will show it.  If it needs more radical reforms, such as moving into universal credit, a review will show it,' Baroness Hollis said.
 
Responding for the Government, local government minister, Baroness Hanham, said the government would not support a review or consider integrating CTB into universal credit - the coalition's flagship welfare policy.

‘Local authorities are closest to their local communities and therefore are closest to those who need the council tax support.  Therefore, they will be in the best position to decide how they set their council tax in future, bearing in mind the needs of their population,' said Baroness Hanham.