Coventry Council Faces £30 Million in Uncollected Tax Arrears

Coventry City Council has an outstanding balance of £30 million in uncollected council tax, a sum that opposition councillors suggested would “shock taxpayers.” Data presented at a council scrutiny meeting indicated that the total amount the authority is owed in arrears has surged by 90% over the four-year period following the onset of Covid. Funds contributed by residents cover two-thirds of the council’s operational expenditures for 600 public services, ranging from waste collection to library provisions. Barrie Strain, Head of Revenue and Benefits, stated that the council found itself in a “challenging position” regarding revenue collection and was making every effort while “being sensitive to the most vulnerable households in the city”. He further explained that Coventry encountered “significant” difficulties in collecting these funds due to elevated levels of deprivation, substantial population movement into and within the city, and its considerable student demographic. Earlier in the current year, the council reduced service funding by £8 million, attributing this to insufficient central government funding, inflation, and increased demand. Additionally, an August report indicated that “urgent action” was under consideration to alleviate budgetary pressures, given that the council is confronting a £7 million overspend. During Wednesday’s meeting, while reviewing the data, councillors were informed that the annual collection rate for council tax had decreased by two percentage points compared to pre-Covid levels. Regarding amounts recovered over a five-year period, the decline was less pronounced; however, officers reported that 2% – approximately £3 million – of council tax was being written off. Peter Male, Deputy leader of the opposition Conservatives, informed the meeting that taxpayers would be “quite shocked” by the £30 million owed to the council. Conversely, Mr. Strain asserted that the council performed “really well” when compared to similar authorities and that the figures were “not disproportionate.” Richard Brown, the Cabinet member for finance for Labour, commented that the council needed to be pragmatic about recovering the funds, considering the difficulties people were facing. He stated: “This is £30m. I’d love to have £30m but there has to be a balance around that. There’s a cost of living crisis, people have gone through some really tough times, and those tough times are still on. I don’t think it’s a question of whether you can simply say we need to get the collection rate up – of course we do. But there are circumstances and we need to live in the real world with this.” This news was compiled by the Local Democracy Reporting Service, which reports on councils and other public service organizations. Follow BBC Coventry & Warwickshire on BBC Sounds, Facebook, X, and Instagram. Copyright 2024 BBC. All rights reserved. The BBC is not accountable for the content of external sites. Information regarding our approach to external linking is available.