Housing Committee - General Debtors Write-Off 2022
North Lanarkshire Council · 14 September 2022
Back to Finance and Resources Committee — 14 September 2022 and its agenda
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North Lanarkshire Council Report Housing Committee Does this report require to be approved? ☒ Yes ☐ No Ref SL/GT/WO22 Date 31/08/22 General Debtors Write-Off 2022 From Stephen Llewellyn, Head of Housing Solutions E-mail telferg@northlan.gov.uk Telephone 07583 010692 1. Background 1.1 During 2021/22, the Council issued invoices with an approximate value of £115m. 1.2 Within Enterprise and Communities there are a number of chargeable services including: • Building cleaning • Fleet Executive Summary This report presents a summary of outstanding debtor accounts which are deemed uncollectable following all attempts at recovery or are considered uneconomically viable to continue pursuing. In accordance with financial guidelines a provision for expected credit losses has previously been established for the outstanding accounts. The total recommended for write-off for 2022/23 is £462,352.29. Recommendations It is recommended that Committee: (1) Acknowledges the decision of the Chief Executive and the Head of Financial Solutions to write-off debts under £500, totalling a new figure of £168,652.09 under delegated responsibility; (2) Approves the write-off of all items over £500 to the value of £293,699.20; and (3) Remits this report to the Finance and Resources Committee. The Plan for North Lanarkshire Priority Improve North Lanarkshire's resource base Ambition statement (21) Continue to identify and access opportunities to leverage additional resources to support our ambitions
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• Waste collection and disposal • Burials • Land rental charges • Rechargeable property repairs, and • Owner/occupier recharges 1.3 The value of Enterprise and Communities invoices raised during 2021/22 financial year was approximately £34m. In conjunction with the corporate debt recovery team, every effort is made to recover any unpaid debt including reminder letters, the use of collection agents and legal action. 1.4 However, despite these steps there are a number of debts that are deemed uncollectible or are considered not economically viable to engage further collection activities and costs. This annual process of assessing the likelihood of debt non- recovery conforms to accepted best accounting practice and is a reasonable assessment of expected income. 1.5 The Council will continue to seek collection of the outstanding balance if the circumstances of the debtor alter and recovery is deemed practical. 2. Report 2.1 Analysis of the outstanding balances has been conducted and £462,352.29 has been identified as uncollectable. 2.2 There are a number of reasons why the outstanding balances are being written off and these are summarised below:- a) Deceased. The debtor is deceased and there have been insufficient funds within the estate to meet the sum due. b) Liquidation/Sequestration. The debtor/business has been liquidated/sequestrated etc, and there is no prospect of recovery of funds. c) No Trace/Gone Away. The debtor has been unable to be located and there is no prospect of recovery of funds. d) Small Balances/Uneconomic to Pursue. There are insufficient funds or no realisable assets that are available to meet the debt and it is uneconomic to continue to seek recovery of the sum due. 2.3 The following tables categorise the value of debt recommended for write off by cause and value:
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Cause Analysis Total Number of accounts £ Deceased 77,940.22 90 Liquidations/Sequestrations etc 10,514.75 12 Gone Away/No Trace 137,650.99 193 Small Balances/Uneconomic to Pursue 121,746.82 850 Recovery Exhausted 114,499.51 495 Total 462,352.29 1,640 Value Analysis £ < £500 168,653.09 1,404 > £500 293,699.20 236 Total 462,352.29 1,640 2.4 The value of accounts identified for write-off represents a small proportion of the accounts raised annually by Enterprise and Communities (around 1.36%). This is reflective of a number of strategies adopted by the service including payment in advance for services where possible, withdrawal of services for non-paying debtors, facilitating payment by direct debit and, where appropriate, payment arrangements. 2.5 For comparison purposes, the total write-offs approved for Enterprise and Communities over the last three years were £238,396.96 for 2019 and £173,976.02 for 2020 and £282,580.61 for 2021. The increase in the current write-off proposals can be largely attributable to an increased write-off for owner-occupier repairs that coincided with the Council’s increased capital investment programme for housing to improve the quality of housing for tenants. 3. Measures of success 3.1 The Service continues to engage in a number of activities aimed at improving collection rates, reducing debt arising and streamlining the recovery process. These include: • Application of the approved Debtors Policy and associated debt recovery procedures • Performance management reports • Payment arrangements • Payment by direct debit • Payment in advance • Cessation of service provision
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3.2 The Council will continue to seek collection of the outstanding balance if the circumstances of the debtor alter and recovery is deemed practical. 4. Supporting documentation 4.1 Not applicable Stephen Llewellyn Head of Housing Solutions
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5. Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality-and-fairer- scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Financial Solutions? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? There are no additional financial implications linked to this report for the current financial year because a corresponding provision for expected credit losses has been included in the previous year’s annual accounts. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People and Organisational Development? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic Solutions? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐
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5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? Where the impact identifies a requirement for technology, has an assessment been carried out (or scheduled) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☐ No ☒ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed?