Unpaid council tax bill reaches £30m

The money from residents pays for two-thirds of the council’s revenue budget

Coventry council is owed £30m in unpaid council tax, an amount that would shock taxpayers, opposition councillors said.

The amount the authority was owed in arrears has rocketed by 90% in the four years since Covid hit, figures discussed at a council scrutiny meeting revealed.

The money from residents pays for two-thirds of the council’s day-to-day spending on 600 public services from bin collections to libraries.

Head of Revenue and Benefits Barrie Strain said the council was in a “challenging position” for bringing in the revenue and was doing everything it could while "being sensitive to the most vulnerable households in the city".

Coventry faced “significant” challenges in collection due to high levels of deprivation, lots of movement to and within the city, and its large student population, he added.

Earlier this year, the council cut funding for services by £8m, blaming under-funding from central government, inflation and soaring demand.

A report in August also said “urgent action” was being looked at to address pressure on budgets, as the council faces a £7m overspend.

Discussing the data at Wednesday's meeting, councillors heard the amount of council tax collected within each year had fallen by two percentage points below pre-Covid levels.

Looking at the amount clawed back within five years, there was less of a drop but 2% - about £3m - of council tax was being written off, officers said.

'I'd love to have £30m'

Deputy leader of the opposition Conservatives, Peter Male, told the meeting people who paid tax would be “quite shocked” by the £30m the council was owed.

However, Mr Strain stated the council compared “really well” with similar authorities and the figures were “not disproportionate.”

Cabinet member for finance, Labour's Richard Brown, said the council would have to be realistic about getting the money, given that people were struggling.

“This is £30m. I’d love to have £30m but there has to be a balance around that," he said.

"There’s a cost of living crisis, people have gone through some really tough times, and those tough times are still on,” he said.

“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 gathered by the Local Democracy Reporting Service which covers councils and other public service organisations.