Residents living in expensive homes in Three Rivers or those who have substantial savings will see their council tax benefit cut from April.

Anyone with £8,000 or more in the bank will not be eligible for council tax support while claimants living in large or expensive homes could find themselves paying up to £12 per week in additional council tax as handouts will be capped at Band D level.

Claimants who share their home with non-dependants such as working-age sons or daughters will also see their benefits reduced.

None of these new rules will affect OAPs and of the 2,922 residents of working age who claim assistance with council tax, only 446 will be affected.

The changes, intended to help Three Rivers District Council to cope with the anticipated 10 per cent reduction in the annual council tax grant without raising council tax, were approved by an extraordinary council meeting last Tuesday (January 8).

Homeowners who keep properties in Three Rivers vacant for two years or more are also being targeted and will face a 50 per cent increase in their council tax.

Council tax exemptions for second home owners and those carrying out refurbishment works on uninhabitable houses will also disappear.

A proposal to continue charging council tax on a home that has been repossessed by the mortgage lender was also approved subject to further government legislation.

The change to exemptions and reductions are expected to affect 486 properties in the district when they have been brought in but should save the council £259,513.

Council leader, Ann Shaw, said:"We have worked hard to respond positively to the national changes. All the local political groups have come together to make a scheme that is sensible and fair.

"Those entitled to council tax benefit living in larger properties and with relatively higher savings will pay more council tax.

"The majority of people in the district will not be affected and all pensioners will be protected from the council tax benefit changes regardless of their situation."

But the council tax reduction scheme met with some dissent from Labour councillors who abstained from voting on that motion with deputy leader Councillor Steve Cox branding it "poll tax mark two".

He said: "Quite clearly this is all part of £500 million coalition government cuts quite merrily put through by Lib Dems in conjunction with Conservatives.

"What this boils down to is an attack on our most needy by a government that gives tax breaks to millionaires.

"It’s a moral outrage."

All local authorities are required to come up with a proposal by the end of January or face having one imposed on them by the government.

Councillor Shaw added: "We have worked across party political lines to make sure that changes in the law are implemented fairly.

"It is reasonable that a small minority of wealthier residents help to bear the burden just as some of those on low incomes are also going to have to pay more through Council Tax Benefit changes.

"By increasing charging on vacant properties we also aim to encourage quicker occupation of vacant homes - for which there is a great need."

The district’s largest landlord Thrive Homes, which manages more than 4,000 homes for social tenants, does not expect to be affected by the vacant property charges.

A spokesman said: "Thrive Homes has very few properties which fall into this criteria; the vast majority of our homes are re-let within one to two weeks."