Debts worth £466k wiped

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DEBTS worth a total of £466,000 have been written out of council accounts by finance chiefs.

Hartlepool Borough Council has written off housing benefit overpayments worth £38,862.15 and irrecoverable business rates totalling £427,512.91.

Finance chiefs say the debts are “irrecoverable” because the businesses have gone bankrupt or into liquidation but insist every effort is made to collect overdue sums.

The council currently bills and collects on behalf of central government for a national business rates pool about £29m but that system changed from April 1 and the local authority will collect and keep their own business rates with the rest topped up from central government.

Therefore finance chiefs wanted to write out the debt before it goes on to the council’s books.

Independent councillor Paul Thompson, portfolio holder for finance and corporate services, said: “Although there is not a great deal we can do when it comes to irrecoverable debts the officers assured me that they don’t allow debts to build up over a long time.

“99.5 per cent of debts are collected over a five-year period and that is a good collection rate.”

One of the debts that was written out dated back to 1999.

Chris Little, the council’s chief finance officer, said the council generally had a good long term collection rates for business rates with the ultimate aim of recovering all monies owed.

Figures show 98 per cent of business rates are collected within the financial year they are billed.

Meanwhile, Coun Thompson also agreed to write out housing benefit overpayments worth £38,862.15.

Officers said about £47m in housing benefits was awarded each year and said there are a number of reasons why overpayments happened including fraudulent claims, people providing incorrect information or failing to tell the council promptly when their financial circumstances changed.

The debts were contained within confidential reports at the meeting.

Where there has been an overpayment and the person continues to receive benefits a weekly deduction is made and when claimants are no longer receiving a benefit an invoice is sent out.

But officers say not all debts are recoverable if people die or they abscond, for example.