Private firm’s council tax discount blitz brings in extra £114,000

A CONTROVERSIAL decision taken a year ago by Scottish Borders Council to hire a private company to target householders erroneously or fraudulently claiming a Council Tax discount appears to have paid off.

As a result of the purge by Northgate Public Services, based at Twickenham in London, some 450 people who were claiming the 25 per cent single person discount (SPD) have now been removed from the register.

The company, contracted on a no win, no fee basis has netted nearly £17,000, having been paid £40 for every householder who was discovered to be wrongly receiving the allowance.

And council coffers, it was revealed this week, are expected to be boosted by £114,000 by the end of the financial year on March 31 as a result of Northgate’s intervention.

It was not the hiring of the company that concerned Borders Party leader Councillor Nicholas Watson last year, but the tone of the letters sent out to around 4,400 SDP claimants who attested they were the “only liable adult” living at the address.

Having obtained the names of all 18,000 Borderers in receipt of the discount, the firm narrowed down its search for possible abuse of the system by using the Experian credit report data base.

The subsequent letters to the target group, incorporating SBC’s logo, demanded the names, details and previous address of other adults living at the house and their relationship to the claimant.

In large print, the letter stated: “We may cancel your discount from the date you first claimed it or it was last checked if you do not respond promptly. Even if you are in receipt of Council Tax benefit you still need to respond within 14 working days.”

The small print of the Northgate letter noted: “The personal information you have given on this form will only be used for Council Tax purposes, but may be shared, as permitted under the Data Protection Act, with other council departments, the police and other public bodies for the purposes of recovery of debt, prevention or detection of fraud or the prevention of crime.”

At the time, Mr Watson said he was not the only councillor who had been contacted by constituents alarmed or even offended by the letter.

The contract was defended by SBC leader David Parker who stressed the “outstanding record” of Borderers in paying their Council Tax on time and in full.

He said: “I am sure the vast majority of Borderers will be please we are ensuring everying is being done to make sure the correct amounts of tax are paid across different categories.”

He said it would have cost the council £20,000 just to ask all SPD recipients in the region to complete a review form.

This week Gary Smith, SBC’s revenue and benefits manager, revealed the success of the exercise with the discount withdrawn in 450 cases.

“Of these, 262 Council Tax payers told us about a change they had not previously advised us about and 204 did not respond to the Northgate canvass [of 4,402 SPD recipitents] and their discount was concelled,” said Mr Smith.

“However, 22 Council Tax payers contacted the council after their discount had been cancelled and, as a result of that contact, the discount was reinstated.

“We are still collecting the 2011/12 Council Tax so the final payment figure is not yet known, but the expected increase in collection is £114,000, with a continuing ongoing benefit in years to come.”

Mr Smith also confirmed that a new four-year contract for the recovery of Council Tax arrears had been awarded to Walker Love Sheriff Officers.

In SBC’s tendering document it stated that it was estimated that “approximatedly 4,500 Council Tax and Non-Domestic Rates accounts with arrears totalling between £3million and £5million could be passed to the supplier [the successful bidder] during a financial year”.

Mr Smith said this week that this range of debt had been used for indicative purposes only.

“It is not any indication the council anticipates that debt will rise; it is simply a provision in the contract in case it does,” he added.