Council planning to write off £3.3m

action on bad debts comes as members consider another £20m of budget cuts

By Calum Ross

Published:

Aberdeen City Council is planning to write off £3.3million of bad debts at the same time as preparing a fresh wave of multimillion-pound budget cuts, it emerged last night.

Councillors will consider the request to scrap “unrecoverable” debts from council tax, business rates, community charges, housing benefit overpayments and rent arrears next week.

It comes after the Press and Journal yesterday revealed that another £20million of savings measures will be put forward by officials in coming weeks, following a request from chief executive Sue Bruce who asked her staff to be ready with potential cuts worth 5% of the budget.

Aberdeen Central Labour MSP Lewis Macdonald hit out at the move, which would follow £60million already cut from services over the last two years.

He said: “If the SNP administration in Aberdeen City Council follow SNP ministers in making cuts across the board, city schools and services for vulnerable people will again be put at risk. A 5% cut would mean another 89 teaching posts would go, on top of those lost in the last two years.

“It is time for Aberdeen City Council to stand up to SNP ministers and stop making cuts that hit the most vulnerable.”

Local authority finance convener Kevin Stewart, SNP group leader, said: “The possibility of further cuts is entirely down to Labour’s £541million cut to Scotland. If Lewis Macdonald wants to lobby his own ministers in London to try and ensure Scotland gets that money back then I will back him.”

He added that the council would do everything it could to retrieve money it was owed. “We will continue to pursue all debtors,” he said.

The level of debt which could be written off is similar in value to last year when there were 10,685 cases of non-payment which resulted in £3,307,770 not being recovered.

Next week, councillors will hear that 9,775 cases, with a value of £3,299,306, are required to be written off for this year.

Council tax, including water charges, and business rates each raised £133million for the council last year, while £35.2million was taken in rent.

Money deemed unrecoverable covers several financial years.

A breakdown of the bad debts shows £754,115 is owed in council tax, £103,569 in community charges, £225,710 in housing benefit overpayment, business rates worth £820,126, and rent arrears with a value of £1,395,784. Problems tracking down debtors is one reason for write-offs, as well as death and people having no assets to pay.