Cash-strapped Fife Council has written off £7.9 million owed to them in 2014-15 as bad debts.
The “unavoidable” and “irrecoverable” debt they have written off is from council tax, sundry debtors and non-domestic rates. The total figure is up from £5.781m written off the previous year.
The overall increase has been caused by writing off £962,000 in residual community charge, £888,000 increase in the write off for non-domestic rates and £600,000 increase in council tax due to a proactive approach at looking at older debts.
The figures will be digested by Fife Council’s executive committee which meets next Tuesday.
Les Robertson, revenue services manager, said: “When reviewing debt write-off it is important that this is considered alongside debt collection performance and that the level of debt written off within 2014-15 accounts for less than 1.5% of the next amount billed.
“Collection rate performance is being maintained and this is being achieved with less resource deployed.
“Over the coming two years we will see the introduction of an integrated approach to income collection across all debt streams, supported by a corporate debt policy which has already been agreed by the executive committee.
“The council actively pursues the collection of debt. However, debt write-off is unavoidable and occurs when individuals and businesses cannot pay their debts, and it is an accepted best practice to ensure that irrecoverable debt is written off.”
The report states that the current economic difficulties are continuing to impact on the level of debt that can be collected.
Fife Council’s leader previously warned the local authority faces more damaging cuts to vital local services due to long-term underfunding by central government.
David Ross made the comment after the Accounts Commission said that Scotland’s councils will face financial pressures “of a scale not previously experienced” in the coming years.
Mr Ross’s Labour-run council faces a £77 million budget gap.