Council writes off £3 MILLION in unpaid tax after bailiffs recover just £35,000

March 24, 2014 | by | 0 Comments

A cash-strapped council has given up chasing almost £3million worth of unpaid tax after bailiffs recovered just £35,000.

Council chiefs decided the debts a lost cause after a debt collection agency managed to recoup just 1.7 per cent of the money.

Stoke-on-Trent City Council, which has made £20million of cuts to services, has a total bad debt of £12.8million.

In total, £2.9million has been written off after the debt collection agency, who work on a ‘no collection, no fee’ basis recovered just £35,000.

The city council stated the debts have been written off due to the debtor dying, absconding, becoming bankrupt or other reasons.

Councillor Terry Crowe, cabinet member for finance, procurement and commissioning, insisted the authority would always take action against people who chose not to pay what they owed.

He said: “Writing off debt is not something we do lightly, and only consider when all reasonable avenues for recovery have been exhausted.

“To be as helpful as possible for people to manage their finances.

“We have set up online account access so customers can manage their council tax and business rates liabilities from their own home, or on the move.

“We continue to take action against those people who can pay but won’t, and if necessary will pursue bankruptcy proceedings.

“But we understand some people may be experiencing financial hardship – we will consider each case on its merits.”

On Thursday Cabinet members will be asked to approve writing off a further £291,471, made up of unpaid business rates of more than £25,000.

Under council regulations, debts under £25,000 can be written off by the finance officer using delegated powers.

Leader of the City Independents group, David Conway said there should have been an “early intervention” to stop the debts.

He added: “With the £1 million they’re spending on HS2, the millions they’re borrowing for the CBD and now this £3 million of unpaid debt they’re writing off, you’d think money was going out of fashion.

“How many millions must they have written off in total over the last five years?

“What I’ve always said is, if you can’t get someone to pay £20, how on earth will you get them to pay when it’s gone up to £500. The key is early intervention.”

Lilian Dodd, secretary of Dresden Residents’ Association, said: “Hard-working people wouldn’t dream of not paying their council tax.

“There’s so many things that need to be done in Dresden alone but the council says it has no money. To hear they’re writing off £3 million is staggering.”

More than £9 million of debts were written off last year at Stoke-on-Trent City Council, including nearly £6 million of unpaid council tax.

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