Update on Northumberland's council-tax collection and debt write-offs

Northumberland County Council had the best council-tax collection rate in the North East last year, but the amount of overall debt written off rose by 14 per cent.

Monday, 17th December 2018, 3:29 pm
Updated Monday, 17th December 2018, 3:36 pm
Northumberland County Council

A debt recovery update has revealed that the local authority wrote off £2.01million in 2017-18 as a whole, up from £1.77million the previous year and £1.44million in 2015-16. The 2014-15 figure was £2.76million.

At the halfway mark of this financial year – September 30 – £483,000-worth of debt has so far been written off.

This comes at a time when the council is having to shave millions from its budget each year.

However, the report, which went before the corporate services committee on Monday (December 17), explained that an ‘integral part of debt recovery is the effective management of irrecoverable debts to ensure that resources are applied effectively to the collection of monies outstanding which can reasonably be expected to be collected’.

What’s more, comparisons to other councils shows the amounts that Northumberland is writing off are well below the average.

As of September 30 this year, the council was owed a total of £21.62million, more than double what was outstanding at this time last year (£10.19million).

However, the £21million figure includes 16 invoices totalling £8.57million, which are either now paid, awaiting payment allocation or being pursued, and a further nine invoices for a total of £4.41million that were issued just before September 30.

In relation to council tax, the authority’s in-year collection rate rose in each of the last four years to a peak of 98 per cent in 2017-18, which was again the highest of the 12 North East councils and comfortably above the averages for English unitary authorities and all English councils.

At the midway point of this year, with the council due £191.1million from its 153,365 domestic properties, the collection rate was 56.4 per cent. This is below performance for prior years, but still second of the 11 regional authorities that have reported performance.

The update explains that the under-performance is due to a number of factors: An increase in the number of customers paying over 12 instalments instead of 10 affecting the profile for collection; the amount collectable is increasing year-on-year with the biggest increase to date in 2018-19 of £11.1million; the volume of changes to accounts has increased (as has contentious cases); and an increase in new dwellings.

Coun Nick Oliver, cabinet member for corporate services, said: “I take a great deal of comfort from this report that debt is being managed properly.”

Ben O'Connell, Local Democracy Reporting Service