Council writes off over £700,000 in debt
Scottish Borders Council has written off more than £700,000 worth of debt owed by local residents.
The council is owed money from Borderers for council tax, non-domestic rates, housing benefit overpayments and sundry debts, but each year writes off the debt it cannot recoup.
However, this year the total of debt written off is around £500,000 higher than last year, when just £259,000 was written off, as the council has begun work on a backlog of debt it is owed.
Council tax debts make up the majority of the money which the council says it cannot recuperate, with £433,848 worth of unrecoverable debt, followed by sundry debt, which is money owed to the council by persons or businesses as part of a credit agreement.
The amount of money owed due to non-domestic rates, on the other hand, has reduced to zero for 2018/19, due to money previously written off becoming available for collection and thus cancelling out the debts the council still cannot recover.
The council has also admitted that the amount of outstanding sundry debt which the local authority may have to write off currently sits at £1.7m.
A report, presented to councillors by finance officer Kirsty Robb at a meeting of the council’s executive body on Tuesday, June 18, outlined the main driver behind debt write-offs.
She said: “The value of council tax write-offs processed within 2018/19 has increased significantly in comparison to last year.
“In 2017/18 the amount written off was unusually low as a result of a reduced number of cases being processed, but also a reduction in the individual case value.
“It was also affected by the prioritisation of newer, rather than aged.
“It was expected that the level of write-offs would increase significantly in 2018/19 as a result of addressing the backlog of cases to be cleared and ensuring ongoing works were maintained.
“The highest value of write-offs for council tax in 2018/19 continues to be within the category where the liable party has become insolvent.
“The number of cases increased from 191 in 2017/18 to 533 in 2018/19, although some of these cases would have become insolvent in 2017/18.”
The council uses Glasgow-based debt collectors Walker Love to recover debts from Borders residents.
Melrose and Leaderdale councillor Euan Jardine asked Ms Robb what circumstances lead to the debt collectors being called.
She said: “We try to recover debts ourselves in the first instance, and we try to work with people who are in debt first, and we only use Walker Love for debts under £500.”
Asked by Hawick and Hermitage councillor George Turnbull how much time elapses before debt proceedings are made against missed council tax payments, she told the executive committee: “If people miss a council tax payment they have 30 days to make it up to us before we start looking at debt recovery.”