£5.7 million of council tax and business rates uncollected in Peterborough last year

More than £5.5 million worth of council tax and business rates went uncollected in Peterborough last year.

Monday, 21st November 2016, 6:00 am
Updated Monday, 21st November 2016, 1:27 pm
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Despite residents being hit with a four per cent council tax rise since April, nearly £3 million of council tax went uncollected the previous financial year, on top of £2.7 million of business rates.

Moreover, the council has written off nearly £1.8 million of uncollected money over the last five years.

Councillor Ed Murphy, Labour and Co-operative member for Ravensthorpe, said: “Failure to collect millions of pounds means our council tax payers pay more each year to cover the Conservatives’ failures and mistakes.

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“I accept that some council and business tax cannot be collected as companies go bust on occasion and some people are impossible to contact, but this should add up to thousands of pounds not £6 million.”

The figures were supplied to the Peterborough Telegraph by a reader following a Freedom of Information request.

Criticising the ruling Conservatives for raising council tax and increasing members’ allowances by 27 per cent, he said: “The staggering amounts owed in council tax arrears are an absolute disgrace.

“Any chief executive or finance officer within any large corporation reporting this level of debt would surely face serious questions and their jobs put on the line.”

In 2014/15, £169 million of council tax and business rates was collected by the council, with nearly £3.5 million uncollected.

The Peterborough Telegraph reported in September that the council was owed approximately £95,000 from Jimmy’s after two firms which previously ran the restaurant failed to pay business rates.

Neither firm is currently running the business.

This year’s four per cent council tax rise is due to raise £2.4 million for the authority, and similar rises are also planned for the next two years as the council faces huge cuts to its government grant.

Cllr David Seaton, cabinet member for resources, said: “We are very persistent when it comes to the collection of council tax and business rates and we continue to chase money that is owed to us long after the end of the financial year for which it is due. For example, in 2015/16 we collected £1.1million in council tax which was owed to us for the previous financial year, and a further £889,000 from 2013/14 and before.

“Therefore the figures included in the FOI response are a work in progress and are continually reducing as we receive money that is owed to us.

“It is also worth noting that despite there being more homes and businesses than ever to collect payment from, as a result of Peterborough being one of the fastest growing cities in the country, our collection rates remain very high. For 2015/16 we have so far collected 96.4 per cent of the council tax owed to us and 97.7 per cent of the business rate bill and we continue to chase the remainder.

“It is inevitable when collecting council tax from 80,000 properties and business rates from 5,801 companies that there will be a need to chase some bill payers for payment and we owe it to the vast majority of residents who pay their bills to do so.

“Despite our best endeavours it is inevitable that a small amount of business rates and council tax will not be collected and will ultimately have to be written off. There are a number of reasons why this occurs with the most common being where a company has gone into liquidation, an individual has been made bankrupt, a debtor has died with no funds available or we are unable to trace a debtor.

“Debt is only written off as a last resort when we have exhausted every possible avenue for payment.”