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Inside Croydon is wrong on Council Tax collection
19/03/2011 08:53:00

The Inside Croydon website can be an excellent source of community news. But at times it can be highly partisan and yesterday's post on Council Tax collection, which I want to belatedly respond to, was a good example.

The key section of the post was as follows:

"Here are some facts: last year, Croydon failed to collect more than £40 million in council tax. That is more uncollected than any other council in the country. That’s according to the ConDem government, a government minister, a Whitehall department , the local government association and CIPFA".

It is true that CIPFA has published data about Council Tax collection and bad debt provision.

But it is not true that "last year Croydon failed to collect more than £40 million in Council Tax". The actual figure, according to CIPFA, is just under £6.9 million.

£6.9 million is not "more uncollected than any other council in the country". Eight London boroughs and metropolitan districts have higher figures. And in any case the amount of money a council is owed isn't a fair comparison - councils with more money to collect will self-evidently be owed more money even if they collect the same percentage of what they are owed as everyone else. Because of our large population and relatively high property prices, only four London boroughs and metropolitan districts have more to collect than Croydon. The fair way to compare councils is to look at the proportion of the Council Tax due that they collect. On this basis, Croydon's performance is in line with the London average. Now I am sure my colleagues on the Council would want us to be better than average but it is certainly not true that we are the worst in the country or anywhere near it - as this Parliamentary answer confirms. Inside Croydon seeks to rubbish the argument that you should focus on percentage collected rather than amount outstanding, describing it as "self-satisfied reductive logic". Now, I know the auther of the blog is a keen Eagles fan so let's use a football analogy. If Team A has played 40 games and conceded 11 goals, while Team B has only played 20 games and conceded 10 goals, would he really describe Team B as having a superior defence because in numerical terms it has conceded fewer goals?

So where does the £40 million figure come from? This is in the CIPFA data but it is nothing to do with what the Council failed to collect last year. It is the amount of money the Council has set aside to cover bad debts. It is true that it is higher than for any other London borough or metropolitan district, which reflects the prudent approach this administration is taking to managing the Council's finances.

You can argue that they are being over-cautious and you can argue that we should aspire to be better than the average when it comes to Council Tax collection. But to claim that Croydon has the worst record in the country has no foundation whatsoever and I hope Inside Croydon will now set the record straight.

Comment on this blog


Readers' Comments

On 23/03/2011 18:58:00 Inside Croydon wrote:
Just caught up with this today. Was busy watching PMQs...

(see here for coverage: http://insidecroydon.wordpress.com/2011/03/23/cameron-considers-moving-government-offices-to-croydon/ )

Our excuse, if we have one, and as was clearly stated in our original report, is that we were reporting what the Daily Express was reporting. Really should know better.

But the essence of the Express's original report, and what we re-reported, remains unaltered and undisputed fact.

The accumulated total of uncollected Council Tax in Croydon is £40.2 million. That is more than any other local authority in England.

You might describe it as amounts set aside to cover bad debts. It is an interesting approach which Mr Barwell's former Croydon Council colleague, ex-mayor Dudley Mead - himself an accountant by profession - did not seek to do so when providing a comment in a council press release being issued last week.

The fact is, the £40.2 million figure is the accumulated uncollected Council Tax in Croydon, up from an uncollected total of £9.2 million in 2005, before the present Conservative-controlled council took over, when Gavin Barwell was on the council.

Our massive team at Inside Croydon Towers encountered great problems in trying to get accurate and reliable information from the Croydon Council press office. Our request for year-by-year figures of uncollected Council Tax remains unanswered six days later. Clearly, the council's press office is far too busy putting out misinformation and misleading press releases.

We are afraid that your football analogy does not really work: Croydon's "rival boroughs" don't have games in hand over their uncollected tax. We are comparing like with like, and the comparison for Croydon is not very flattering.

As for your assertion about Eagles fandom, it is either a case of mistaken identity, or actionable.

We are absolutely happy to set the record straight: at an accumulated £40.2 million, Croydon has more uncollected Council Tax than any other local authority in England.

One of Mr Barwell's colleagues in the ConDem Government, Grant Shapps, has described authorities who have failed to collect lesser amounts of Council Tax as exhibiting “breathtaking incompetence when it comes to basic financial management”.

On 23/03/2011 22:17:00 Gavin Barwell wrote:
"But the essence of the Express's original report, and what we re-reported, remains unaltered and undisputed fact. The accumulated total of uncollected Council Tax in Croydon is £40.2 million. That is more than any other local authority in England."

Er, no.

The total of previous years' arrears as at 31st March 2010 is £36.3 million according to CIPFA.

And that is not more than any other authority in the country - the highest is Liverpool at £94.5 million.

If you look at cumulative arrears as a percentage of the amount to be collected - a fairer comparison - Croydon has the 10th worst record of the 32 London boroughs. The reason we fair slightly worse on this comparison than the collection rate for 2009/10 - where as noted above we are in line with the London average - is that the cumulative arrears include years when Labour were running the Council, during which time Council Tax collection rates were below the London average.

I can email you the full CIPFA spreadsheet if you like and you can repent at leisure?

On 28/03/2011 13:42:00 Elizabeth wrote:
I've followed this debate on Twitter also and asked that you send the spreadsheet to Inside Croydon team. I also note others have picked up on this and requested the whole CIPFA dataset that you offered. Has this been sent?

I also question the figures. On Twitter you admitted it is an unfair comparison, yet your blog has not been updated to reflect this. The correct figure, according to you, is actually £36 million and not £40.2 million in uncollected Council Tax as Inside Croydon reported. I may not be a mathematical whiz but that seems remarkably close to the figure IC quoted and poles apart from the £6.9 million you refer to.

Of course the IC figure is the accumulative figure as uncollected presumably remains uncollected unless received, or do the Council actually write it off as not significant at year end? To my mind Croydon could do an awful lot with just the last year's figure you quote of nearly £7 million. That's an awful lot of libraries, arts funding, and services that would not be under threat.

On 29/03/2011 22:11:00 Gavin Barwell wrote:

You haven't been following very closely.

Inside Croydon has made three incorrect claims.

First, "Last year, Croydon failed to collect more than £40 million in council tax". This is not true. The correct figure is £6.9 million.

Second, "The accumulated total of uncollected Council Tax in Croydon is £40.2 million". This is also not true. As at 31/3/10, the total of previous years' arrears was £36.3 million.

Third, in relation to both these claims, "That is more uncollected than any other council in the country". This is not true whether you look at cash amounts or the more fair basis of arrears as a percentage of the amount to be collected. The truth is that Croydon's performance last year was average compared with other London boroughs and its historical performance is below average, due to very poor performance when Labour were running the Council.

You are quite right to say that £6.9 million is a lot of money and I have no problem with people saying the Council needs to do better but a fair discussion of this issue would start with a recognition that the Council's performance is average, not the worst in the country; and that the current administration has significantly improved performance.




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