How to provide a fair hardship relief scheme

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Hardship relief options

  • Have a financial hardship policy setting out short-term and long-term hardship relief options, eligibility and how to apply
  • Be willing to consider waivers and deferrals and always consider the merits of people’s applications
  • Don’t charge penalty interest to people meeting their obligations under payment arrangements, or have had payments deferred due to financial hardship.


  • Inform people about all of their hardship relief options in clear language and accessible format
  • Ensure staff dealing with people in hardship are familiar with the hardship policy
  • Publicise your hardship policy to ratepayers in hardship through multiple avenues eg prominent information on rates notices, use of local media and social media, offering information through local support services.

Application process

  • Make application processes proportionate to the relief sought, and only require supporting documents for more substantial forms of hardship relief
  • Develop hardship agreements appropriate to the person’s individual circumstances
  • Offer referral to financial counsellors, but do not insist on use of these services.

Debt recovery

  • Ensure debt collectors are subject to clear and enforceable standards, and comply with hardship relief policies.
  • Require debt collectors to inform people of all available hardship relief options and to refer people who disclose financial hardship to the council or government body for consideration
  • Do not take legal action unless there have been reasonable efforts to contact the person and they have been given the opportunity to apply for hardship relief
  • Ensure debt collection practices are consistent with national guidelines
  • Legal action should be the last resort.

In the real world

The Victorian Ombudsman heard concerns from ratepayers, financial counsellors and community lawyers about the way local councils treat people who cannot afford their council rates. The investigation into Victorian councils found while some policies were good, some councils had policies that were inaccessible, and in some cases, unfair and wrong. Many people struggling to pay rates were told their only option was a payment plan, when the legal framework includes waivers and deferrals – which some councils have a blanket policy of refusing. Some councils took victims of family violence and those with mental health issues to court over unpaid rates, and people in hardship were charged penalty interest they could not pay back.

Final word

“Good hardship relief schemes get the balance right. And driving people in hardship further into debt or outof their homes is short-sighted. It creates costs for other parts of government, costs that are also borne by taxpayers.” – Deborah Glass, Victorian Ombudsman.

  • Councils
  • Rates, charges and penalties
  • COVID-19