Decision details

Suspension of Recovery Action

Decision Maker: Cabinet Member for Finance and Resources

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: Yes

Purpose:

To seek approval to suspend recovery action as part of the Council’s response to the COVID-19 pandemic.

Decision:

That approval is granted to

·      Suspension of the Fair Collection and Debt Recovery Policy up to 30 June 2020

·      Cease any legal and external debt collection activity

·      Offer deferral for Council Tax and Business Rates instalments for those paying in 10 monthly instalments from April 2020 – January 2021 until June 2020 – March 2021

·      Continue to co-ordinate support for businesses through InvestSK, but consider any additional support over and above existing rate relief on a case-by-case basis

·      Review after 30 June 2020

 

Reasons for the decision:

The financial implications of the current situation is under constant review with particular focus on cash flow and budgetary impact.  Income receipts from residents and businesses are a key element of the Council’s cash flow management and any suspension,  can only be temporary in order to protect the Council.  However, it is recognised that it is an appropriate action given the difficulties experienced by specific stakeholders given the current economic context.

 

Alternative options considered:

The current Recovery Policy is not appropriate in the current circumstances and could place financial burden on specific elements of the community during the pandemic period.  Therefore the recommendation is to suspend the policy for the current period and introduce specific and individual support to those experiencing financial difficulties during this period.

These recommendations have been developed alongside reviewing the evolving approaches other local authorities are undertaking.  This was carried out through a review of websites and consultation with specific local authorities.  The recommendations made are consistent with the majority of local authorities that have made changes.

This overall approach allows those that can pay continue to do so and thus reduce the risk of greater debt once normal debt recovery procedures are adopted.

Encouragement of contact if struggling to pay will help us to target help and resources where needed and may help us to signpost residents and businesses to wider support and/or grants and benefits that might be available.  The failure to pay the Council may be an indicator of wider financial difficulties, so it can be used as a way of identifying residents that could need additional support.

Offering to defer Council Tax for ten instalments from June-March and suspending external debt collection / legal recovery is in line with many other local authorities and is felt a proportionate response in the current circumstances.

Reviewing the suspension of usual processes will allow monitoring of the developing situation and any further advice or guidance from Government.  It will also enable us to see what impact this has on collection rates, feed in any data gathered from the resilience forums and requests for financial support.  Furthermore, legislation has been introduced to prevent repossessions orders commencing for non-payment of rent in both private and social accommodation for at least 3 months, therefore this approach aligns debt collection approaches across Council services.

 

 

Publication date: 12/05/2020

Date of decision: 11/05/2020

Effective from: 20/05/2020

Accompanying Documents: