£2m of ‘uncollectable debt’ written off by Peterborough City Council after years of efforts

The authority has agreed to write-off debts of more than £10,000 relating to business rates, council tax, housing benefit overpayments and miscellaneous arrears totalling £2.157 million.

The council said: “All cases requested for write-off follow a lengthy process to recover the outstanding money, sometimes dating back many years. Only once all avenues have been exhausted will the council consider writing off debt.”

The total sum is 0.1 per cent off all debt raised over the period.

The council said it “recovers millions of pounds every year in unpaid debt, sometimes dating back years, due to being persistent in recovery activity”.

But it added: “Despite our best endeavours, it is inevitable that a small percentage of debt 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 where it has not been possible to trace a debtor.

“It is very common for large organisations in both the public and private sectors to incur debt, and the council is no different in that respect.

“Writing off debt is standard practice and recommended as part of good budget management.”

Some of the uncollectable debt goes back to before 2009.

The council said where debt has been written off in relation to companies that have gone into administration/individuals being made bankrupt, it has “exhausted recovery action” with no other steps left to be taken.