Cash woes for city as £15m of council tax goes unpaid

Published on Saturday 13 June 2009 11:20

TAXPAYERS have been left out of pocket after new figures revealed that £15 million of council tax went uncollected last year.

With thousands of city residents dodging the tax, the total debt owed to the city council since its formation in 1997 now stands at 117m – enough to build four secondary schools.

More than 90 per cent of council tax is collected on time but there are around 12,000 people not paying. Much of the debt dates back to the late 1990s and includes money still owed by those who refused to pay the ill-fated poll tax.

Council chiefs today insisted they were working hard to recover council tax arrears, but hit out at residents who can afford to pay but choose not to.

However, opposition politicians today highlighted that the arrears could comfortably pay for the 92m of efficiency savings being faced by city leaders over the next three years.

Councillor Iain Whyte, the city's Tory leader, said: "It is a considerable sum of money and interestingly it is more than the 92m of cuts which the council is telling us it needs to find.

"It shows just how important it is that the council chases this outstanding money and also makes sure people pay on time.

"It is important they do this because the council has to do the right thing by those people who have paid their bills on time.

"The council needs to make sure money owed is paid within the year it is owed in order to stop this sort of situation arising in the first place."

The 15m not paid in 2008-9 is just above the 14.5m that council chiefs failed to collect in 2007-8.

In 2003-04, the council's collection rate hit a record low of 87.6 per cent. Since then, the level has been increasing as the council and sheriff officers caught up with non-payers with the rate in 2007-8 hitting 92.9 per cent.

Across Scotland around 100m of council tax goes uncollected every year. Councillor Phil Wheeler, the city's finance leader, said: "We work hard to recover council tax arrears.

"A considerable amount of money is owed by people who can afford to pay but choose not to. This is unfair on the majority of residents and means that the council has less money to spend on vital services.

"We have a duty to taxpayers to take targeted action against those that don't pay and to check that those who claim they can't pay are genuinely unable to do so. In those cases we review their circumstances – taking account of sensitive and difficult cases – and try to work out alternative arrangements.

"Targeted action is working with increased payment being received."