Minutes:
A joint report of
the Executive Member for Finance and Governance and the Director of Finance was
presented asking the Committee to consider a Corporate Debt Write Off Policy.
The purpose of
this new policy was to provide a corporate approach to the writing off of bad
and irrecoverable debts in a fair and timely manner, whilst seeking to maximise
the opportunity for collection, thereby minimising the need for write off.
All service areas
would have to follow this policy to allow the Council to operate a consistent
approach to debt write off, whilst having due regard to the customer’s ability to
pay. Whilst some parts of debt write off were governed by particular
legislative requirements such as Council Tax, Business Rates, Adult Social Care Debt; wherever possible the overall
principle of debt write off should be efficient and effective, and always give
consideration to the financial impact on the Council when debt was written off.
This policy would
underpin any specific recovery strategies and be applied across all
directorates. The policy would also
support cross directorate communication where a shared customer base
existed. It was envisaged that the
approach would work within Data Protection legislation, and should be
considered at a corporate level to reduce multiple officer engagements across
directorates with the same resident and or business base.
The introduction
of a Corporate Debt Write Off policy was part of the Council’s strategic direction, and as such required executive
consideration followed by Council approval.
The Council had a statutory duty to collect outstanding debt and did so
in accordance with the Local Government Finance Act 1992 and the Council’s Financial
Procedure rules. The introduction of this policy would
support this duty and also ensure that the Council’s debt write off
approach/methods were consistent, fair and efficient across all of its
services.
This was the
third of four policies being developed that brought together a significant
number of supporting arrangements that would not only complement, but enhance the
Council’s social regeneration plans:
The policy set
out a framework for a consistent approach to write off by delegating debt
levels to various Managers/Heads of Service where the aim was to enable cases
that fitted specific criteria (contained within the policy) to be written off,
which would in turn enable the more efficient collection of outstanding
debt. The policy also sought to address
other matters such as credit balance write offs and the reinstatement of
previously written off debt.
The policy applied to all debts owed/due to
the Council and the general principles adopted in the policy were as follows:
The policy linked into the
Council’s Vulnerability Policy
and the Stop the Knock approach and looked to ensure that supporting
arrangements were in place for debtors where their vulnerability affected their
ability to pay a debt owed to the Council.
Those considered to be vulnerable with an ‘unrecoverable’ debt would be
linked into the Social Inclusion arrangements
contained in the recently adopted Debt Management Policy.
The policy applied to debts and income due
to the Council including:
It was noted that this list was not
exhaustive.
The policy
provided a comprehensive approach that allowed for the automatic write off of
debt by Heads of Service through a “pre-request for write off”
process, where the debt met
pre-determined criteria which made it unrecoverable. This criteria (whilst not exhaustive) covered
debt which was uneconomical to recover, unenforceable, and those debtors that
had been untraceable for a period of over 6 months, amongst others.
Specific
delegations of authority were contained within the policy, within the
pre-request process and the amounts that could be written off following
submission for suitability, which varied depending on the type of debt.
The policy also
ensured that where specific legislation required that a debt should be written
off, these debts could be processed without delay by
the manager responsible for the service. The policy also extended to the reinstatement
of previously written off debt and credit balances at a corporate level.
Consideration to
the use of third party collection services (which should not be confused with
bailiff/enforcement services), where debts were considered uneconomical to
recover would be given, to maximise cash opportunities to the Council.
Over a period of
time debts would be cleared and a more accurate picture of the Council’s
overarching debt could be provided.
It was confirmed
that all Local Authorities shared a database and reported information in
relation to absconders to try and trace them
AGREED as follows that:
Supporting documents: