Issue - meetings

To seek approval for the write off of uncollectable debt (report of the Director of Finance (Section 151 Officer) enclosed).

The Portfolio Holder for Finance introduced the report, emphasising the importance of maintaining an efficient and well?administered debt management system to support the Council’s financial operations. It was noted that, through sustained recovery and enforcement activity over several financial years, the Council had consistently achieved collection rates exceeding 99% for both Council Tax and Business Rates. However, due to the scale and nature of annual revenues, some debts ultimately became irrecoverable.

The Portfolio Holder confirmed that the Council applied robust and comprehensive recovery processes, with debts only considered for write?off once all recovery and enforcement options had been exhausted and no realistic prospect of recovery remained. Recovery steps had included issuing statutory notices, obtaining liability orders, engaging proactively with debtors, arranging payment plans, making deductions from earnings and benefits, referring cases to enforcement agents, undertaking multiple tracing attempts, and initiating appropriate action in cases involving insolvency.

The report sought Cabinet approval to write off £114,957.44 of irrecoverable debt, with the direct loss to the Council amounting to £42,481.33. Details were provided in the confidential appendices and summarised within the report, and it was highlighted that 56% of the total debt related to insolvency cases. All write?offs were charged against existing bad debt provisions, meaning there was no impact on the Council’s budget, and debts could be reinstated should new information arise.

It was further noted that the existing delegation threshold, under which debts above £1,050 required Cabinet approval, had remained unchanged for many years. In the current financial year, the Section 151 Officer had approved £33,948.13 of write?offs under the delegated limit. The Portfolio Holder therefore proposed increasing the delegation threshold to £5,000 to reflect the scale of Council revenues and streamline the authorisation process.

It was noted that the level of debt proposed for write?off was significantly lower than in comparable previous periods. Members were reminded that a comprehensive recovery exercise had been undertaken approximately 18 months earlier, and that overall collection performance had improved since that time. Although financial pressures for many households had increased, the anticipated rise in irrecoverable debt had not materialised, indicating that early engagement and proactive dialogue with residents experiencing financial difficulty had been effective.

Reference was also made to the extension of the Council Tax reduction scheme, which had supported some households and contributed to stabilising collection levels.

In relation to the proposed change to the Section 151 Officer’s delegated authority for debt write?offs, it was noted that the revised threshold aligned the Council more closely with neighbouring authorities, many of which operated at higher levels. While the uplift represented a substantial increase from the current limit, it was emphasised that it still related to relatively low?value cases and that write?offs would continue to be visible to Members through reporting in the appendices.

DECISION:

That Cabinet approves: -

1)    The write off of debts identified in this report, pending further information on an individual matter; and  ...  view the full minutes text for item 91