July 31 2014 Latest news:
by DAN GRIMMER
Thursday, August 9, 2012
Councils in our region failed to collect more than £22m in council tax and business rates in the past financial year, new figures have revealed.
And, at a time when they are having to cut costs, the local authorities were urged to do more to recover debts from those who fail to pay up.
Government figures showed the combined value of unpaid council tax and business rates in Norfolk for 2011/12 was £12.2m, up from £10.5m the previous year.
Adding parts of Fenland, East Cambridgeshire, Waveney, Suffolk Coastal, Mid Suffolk, Forest Heath and St Edmundsbury brings the total to just over £22m.
Norwich City Council was the poorest performer in Norfolk in terms of council tax collection with a collection rate of 94.6pc. It collected £48.1m of the £50.8m due to the authority, a gap of £2.7m. The previous year it had a collection rate of 96pc, with just over £2m uncollected.
City Hall also failed to collect £1.7m in business rates, with £73m collected, compared to a potential £74.7m.
While the government figures show what was uncollected at the end of financial year to which they relate, collection does continue beyond the end of the year. But James Wright, leader of the Liberal Democrat group at Norwich City Council, said: “These figures show that for the second year running, Norwich City Council is shown to be the poorest performing council in Norfolk when it comes to collecting in council tax.
“At a time when local councils have had to make savings, it is simply unacceptable that so much money goes uncollected. This is money that could be spent on services for people in Norwich and used to mitigate against further cuts.”
But Alan Waters, deputy leader of Norwich City Council, hit back. He said: “We take a hard line in pursuing people who don’t pay their council tax. While the figure shows we collected 94.6pc in 2011-12, what it doesn’t show is that we continue to pursue the outstanding amount and usually end up recovering close to 99pc. The same applies for the business rates.
“It’s also important to know that council tax money goes into a council tax collection fund which covers any temporary shortfalls. This means there is absolutely no impact on the services we provide, or on jobs.
“What these figures also show is further evidence that the city, which has long struggled with deprivation levels, is not immune to the effects of the recession – something borne out in the increase we’ve seen in benefit applications.”
The best performer in Norfolk was Broadland District Council, which collected 99pc of what it was owed. It missed out on £601,000 in council tax and £219,000 in business rates.
It said its impressive collections rates were partly due to the authority offering people the chance to pay by direct debit, with 82pc of residents and businesses paying that way.
Where appropriate the council can offer flexible payment arrangements for people who are struggling to pay and professional debt advice is also available for those suffering hardship, the council said. It said it also took rapid action when people defaulted on payments, by sending reminders soon after, and focusing enforcement action early in the year against those with the worst payment records.
Paul Carrick, portfolio holder for finance, said: “Broadland residents and businesses clearly recognise their responsibility for paying their fair share even in such busy and economically difficult times.”
The overall figures showed that, across Norfolk in 2011/12, just over £7.95m in tax was not collected, compared to £7.15m in 2010/11.
On business rates, a little over £4.2m went uncollected in 2011/12, compared to £3.36m the previous year.
In Suffolk, Waveney District Council failed to collect just over £1.24m in tax, but was the second best performer in that county when it came to business rates, collecting 98.6pc.
While city and district councils collect the tax, they do not get all of the money. The lion’s share goes to county councils and police authorities, while, in some areas, town and parish councils also levy a precept.
Local government minister Bob Neil recently said, in response to a Parliamentary question about uncollected council tax: “Every penny of council tax that is not collected means higher council tax for the law-abiding citizens who do pay on time.”