Add Merton council tax reduction

changelog.d/council-tax-reduction-merton.md

@@ -0,0 +1 @@
+Add Merton working-age Council Tax Reduction.

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/maximum_support_rate.yaml

@@ -0,0 +1,10 @@
+description: Maximum share of eligible Council Tax liability covered for working-age households under the Merton Council Tax Support scheme.
+values:
+  2026-04-01: 1
+metadata:
+  unit: /1
+  period: year
+  label: Merton Council Tax Support maximum support rate
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/means_test/capital_limit.yaml

@@ -0,0 +1,10 @@
+description: Capital limit for working-age households under the Merton Council Tax Support scheme.
+values:
+  2026-04-01: 16_000
+metadata:
+  unit: currency-GBP
+  period: year
+  label: Merton Council Tax Support capital limit
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/means_test/withdrawal_rate.yaml

@@ -0,0 +1,10 @@
+description: Withdrawal rate for working-age households under the Merton Council Tax Support scheme.
+values:
+  2026-04-01: 0.2
+metadata:
+  unit: /1
+  period: year
+  label: Merton Council Tax Support withdrawal rate
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/non_dep_deduction/amount.yaml

@@ -0,0 +1,27 @@
+description: Weekly non-dependant deduction schedule under the Merton Council Tax Support scheme.
+brackets:
+  - threshold:
+      2026-04-01: 0
+    amount:
+      2026-04-01: 5.20
+  - threshold:
+      2026-04-01: 279
+    amount:
+      2026-04-01: 10.60
+  - threshold:
+      2026-04-01: 485
+    amount:
+      2026-04-01: 13.30
+  - threshold:
+      2026-04-01: 605
+    amount:
+      2026-04-01: 15.95
+metadata:
+  amount_unit: currency-GBP
+  period: week
+  threshold_unit: currency-GBP
+  type: single_amount
+  label: Merton Council Tax Support non-dependant deduction schedule
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/non_dep_deduction/remunerative_work_hours.yaml

@@ -0,0 +1,10 @@
+description: Minimum weekly hours for remunerative work under the Merton Council Tax Support non-dependant deduction rules.
+values:
+  2026-04-01: 16
+metadata:
+  unit: hour
+  period: week
+  label: Merton Council Tax Support remunerative work hours
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/tests/policy/baseline/gov/local_authorities/council_tax_reduction/council_tax_reduction.yaml

@@ -93,3 +93,161 @@
     council_tax_reduction_scheme_supported: true
     simulated_council_tax_reduction_benunit: 1_800
     council_tax_reduction: 1_800
+
+- name: Merton working-age claimant can receive full support
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 35
+    benunits:
+      benunit:
+        members: [claimant]
+        would_claim_uc: false
+        claims_all_entitled_benefits: true
+    households:
+      household:
+        members: [claimant]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 0
+  output:
+    council_tax_reduction_scheme_supported: true
+    simulated_council_tax_reduction_benunit: 1_800
+    council_tax_reduction: 1_800
+    council_tax_less_benefit: 0
+
+- name: Merton working-age claimant above capital limit gets no local support
+  period: 2026
+  absolute_error_margin: 0
+  input:
+    people:
+      claimant:
+        age: 35
+        council_tax_benefit_reported: 500
+    benunits:
+      benunit:
+        members: [claimant]
+        claims_all_entitled_benefits: true
+    households:
+      household:
+        members: [claimant]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 16_001
+  output:
+    council_tax_reduction_scheme_supported: true
+    simulated_council_tax_reduction_benunit: 0
+    council_tax_benefit: 0
+    council_tax_reduction: 0
+
+- name: Merton applies its 2026 local non-dependant deduction schedule
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 35
+      non_dep:
+        age: 25
+        employment_income: 15_000
+        weekly_hours: 16
+    benunits:
+      claimant_benunit:
+        members: [claimant]
+        would_claim_uc: false
+        claims_all_entitled_benefits: true
+      non_dep_benunit:
+        members: [non_dep]
+    households:
+      household:
+        members: [claimant, non_dep]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 0
+  output:
+    council_tax_reduction_scheme_supported: true
+    council_tax_reduction: 1_248.80
+
+- name: Merton exempts UC non-dependants with no earned income
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 35
+      non_dep:
+        age: 25
+        weekly_hours: 16
+    benunits:
+      claimant_benunit:
+        members: [claimant]
+        would_claim_uc: false
+        claims_all_entitled_benefits: true
+      non_dep_benunit:
+        members: [non_dep]
+        would_claim_uc: true
+    households:
+      household:
+        members: [claimant, non_dep]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 0
+  output:
+    council_tax_reduction: 1_800
+
+- name: Merton UC claimant uses UC maximum amount and DWP income
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 35
+    benunits:
+      claimant_benunit:
+        members: [claimant]
+        would_claim_uc: true
+        claims_all_entitled_benefits: true
+        uc_maximum_amount: 5_000
+        uc_income_reduction: 2_500
+        uc_earned_income: 6_000
+        uc_unearned_income: 0
+    households:
+      household:
+        members: [claimant]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 0
+  output:
+    universal_credit: 2_500
+    council_tax_reduction: 1_100
+
+- name: Merton UC claimant uses UC-reported capital
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 35
+    benunits:
+      claimant_benunit:
+        members: [claimant]
+        would_claim_uc: true
+        claims_all_entitled_benefits: true
+        uc_reported_capital: 0
+    households:
+      household:
+        members: [claimant]
+        country: ENGLAND
+        local_authority: MERTON
+        council_tax: 1_800
+        savings: 20_000
+  output:
+    uc_assessable_capital: 0
+    council_tax_reduction: 1_800

policyengine_uk/variables/gov/local_authorities/council_tax_reduction/_legacy.py

@@ -0,0 +1,142 @@
+from policyengine_uk.model_api import *
+from policyengine_uk.variables.household.demographic.highest_education import (
+    EducationType,
+)
+
+
+def is_full_time_student_non_dep(person, period):
+    return (person("current_education", period) != EducationType.NOT_IN_EDUCATION) | (
+        person("in_HE", period)
+    )
+
+
+def legacy_council_tax_reduction(
+    benunit,
+    period,
+    ctr,
+    working_age,
+    non_dep_deductions_variable,
+):
+    is_household_head_benunit = benunit("benunit_contains_household_head", period)
+    would_claim = benunit("would_claim_council_tax_reduction", period)
+    applicable_amount = benunit("council_tax_reduction_applicable_amount", period)
+    applicable_income = benunit("council_tax_reduction_applicable_income", period)
+    universal_credit = benunit("universal_credit", period)
+    has_uc_award = universal_credit > 0
+    uc_applicable_amount = benunit("uc_maximum_amount", period)
+    uc_applicable_income = (
+        benunit("uc_earned_income", period)
+        + benunit("uc_unearned_income", period)
+        + universal_credit
+    )
+    applicable_amount = where(has_uc_award, uc_applicable_amount, applicable_amount)
+    applicable_income = where(has_uc_award, uc_applicable_income, applicable_income)
+    relevant_income_based_benefit = benunit(
+        "council_tax_reduction_relevant_income_based_benefit",
+        period,
+    )
+    liability = benunit.household(
+        "council_tax_reduction_maximum_eligible_liability", period
+    )
+    non_dep_deductions = benunit(non_dep_deductions_variable, period)
+    excess_income = max_(0, applicable_income - applicable_amount)
+    excess_income = where(
+        relevant_income_based_benefit & ~has_uc_award, 0, excess_income
+    )
+    preliminary_award = max_(
+        0,
+        liability * ctr.maximum_support_rate
+        - excess_income * ctr.means_test.withdrawal_rate
+        - non_dep_deductions,
+    )
+    capital = where(
+        has_uc_award,
+        benunit("uc_assessable_capital", period),
+        benunit.household("savings", period),
+    )
+    capital_eligible = capital <= ctr.means_test.capital_limit
+    return (
+        working_age
+        * is_household_head_benunit
+        * would_claim
+        * capital_eligible
+        * preliminary_award
+    )
+
+
+def local_non_dep_deductions(
+    benunit,
+    period,
+    individual_deduction_variable,
+    one_deduction_for_uc_couples=True,
+):
+    deductions = benunit.members(individual_deduction_variable, period)
+    deduction_for_benunit = benunit.max(deductions)
+    if not one_deduction_for_uc_couples:
+        has_uc = benunit("universal_credit", period) > 0
+        deduction_for_benunit = where(
+            has_uc,
+            benunit.sum(deductions),
+            deduction_for_benunit,
+        )
+    is_benunit_head = benunit.members("is_benunit_head", period)
+    deductions_to_count = is_benunit_head * benunit.project(deduction_for_benunit)
+    deductions_in_household = benunit.max(
+        benunit.members.household.sum(deductions_to_count)
+    )
+    return deductions_in_household - deduction_for_benunit
+
+
+def normal_gross_income_non_dep_deduction(
+    person,
+    period,
+    ctr,
+    working_age,
+    exempt_income_based_benefits=True,
+    exempt_uc_no_earned_income=True,
+):
+    gross_income_components = [
+        "employment_income",
+        "self_employment_income",
+        "property_income",
+        "private_pension_income",
+        "savings_interest_income",
+        "dividend_income",
+        "state_pension",
+    ]
+    earned_income_components = [
+        "employment_income",
+        "self_employment_income",
+    ]
+    gross_income = add(person, period, gross_income_components)
+    earned_income = add(person, period, earned_income_components)
+    weekly_benunit_gross_income = person.benunit.sum(gross_income) / WEEKS_IN_YEAR
+    weekly_benunit_earned_income = person.benunit.sum(earned_income) / WEEKS_IN_YEAR
+    benunit_weekly_hours = person.benunit.max(person("weekly_hours", period))
+    in_remunerative_work = (
+        benunit_weekly_hours >= ctr.non_dep_deduction.remunerative_work_hours
+    )
+    weekly_deduction = where(
+        in_remunerative_work,
+        ctr.non_dep_deduction.amount.calc(weekly_benunit_gross_income),
+        ctr.non_dep_deduction.amount.calc(0),
+    )
+    claimant_exempt = person.household(
+        "council_tax_reduction_household_has_non_dep_exemption", period
+    )
+    full_time_student = is_full_time_student_non_dep(person, period)
+    income_based_benefit = (
+        (person.benunit("income_support", period) > 0)
+        | (person.benunit("jsa_income", period) > 0)
+        | (person.benunit("esa_income", period) > 0)
+        | (person.benunit("pension_credit", period) > 0)
+    )
+    has_uc = person.benunit("universal_credit", period) > 0
+    no_earned_income = weekly_benunit_earned_income <= 0
+    exempt = (
+        claimant_exempt
+        | full_time_student
+        | (exempt_income_based_benefits & income_based_benefit)
+        | (exempt_uc_no_earned_income & has_uc & no_earned_income)
+    )
+    return working_age * where(exempt, 0.0, weekly_deduction * WEEKS_IN_YEAR)