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Mapped: sharp rise in council tax arrears as residents feel the strain


The total council tax owed in England has risen by 6.6% in the past year, according to LGC analysis of new Ministry of Housing, Communities & Local Government data.

Tax arrears of more than £3bn were reported outstanding nationally as of 31 March, an increase of £186.7m on the £2.8bn reported for 2017.

The total amount required to meet court costs for debt collection also rose by 4.8%, from £292m in 2016-17 to £306m in 2017-18.

This comes after the Commons Treasury committee last week found local authorities to be “worst in class” for debt collection practices. 

Responding to LGC’s analysis, Don Peebles, head of policy and technical at the Chartered Institute of Public Finance & Accountancy, said: “An increase in council tax arrears speaks volumes about the financial strain felt both by the public and the public bodies that serve them.”

Reflecting on the biggest increase in council tax for 14 years, Mr Peebles said the “sharp rise reflects the enormous financial pressures many local authorities” are under.

It “also adds additional burden on those households struggling to make ends meet, especially against a backdrop of rising inflation and an increasing cost of living.”

Mr Peebles called for “the conversation about local government funding to go beyond the remit of c ouncil tax, business rates and grants” as “other freedoms and flexibilities” are needed to put the sector on a sustainable footing.

The councils that reported the largest percentage increase in arrears between 2016-17 and 2017-18 were Bromsgrove DC with 131%, North Hertfordshire DC (129%) and Copeland BC (76%).

LGC analysis did not find a correlation between total court costs for debt collection and the total amount of tax paid.

Thurrock Council reported the largest amount of court fees as a percentage of its outstanding arrears, spending £1.49m, or 61.5% of its total arrears. Despite this, the council reported a similar collection rate to many councils that spent much far less.

When looking at tax arrears per chargeable household, Liverpool City Council had the biggest proportional deficit with an average £472 owed  in 2017-18. However, that had decreased by £25 per household from the previous year.

One of the councils reporting the biggest annual decreases in tax arrears was North Warwickshire BC, which told LGC it had invested a “significant amount of time and effort” into reviewing each debt individually. A council spokesman said: “We have also worked closely with our food hub, housing department and a number of financial inclusion partners, mainly from the third sector but also other agencies, to provide targeted support, promoting better engagement and engendering a culture of payment in the borough.”

Some councils told LGC the ministry’s figures did not match their own. Hull City Council, for example, said its reported court costs of £3.3m were incorrect as they represented cumulative costs “going back 20 years”.

A spokesperson for Oldham MBC warned comparing court costs would be “highly misleading” as different councils pursue debt collection in different ways.

Ministry documents say the figures were submitted by councils themselves.

Citizens Advice chief executive Gillian Guy said: “Council tax arrears are now the most common debt problem we see but, sadly, many councils are failing people in financial difficulty who fall behind with their payments.”

She warned using “a heavy-handed tactic” like bailiffs “can intensify debt problems, cause issues around people’s mental health, and is ineffective in recovering money.”

Citizens Advice noted reports of problems with bailiffs had risen by more than 25% since 2014.

In its report, released last week, the Treasury committee found councils are chasing debts “over-zealously, uncompromisingly, and with routine recourse to bailiffs”, despite rising evidence that this could lead to suicide.


Readers' comments (2)

  • Very odd map - County Durham has been taken over by Coventry and that's only the start. Lots of local authorities migrating around the country.

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  • I'm surprised to see no mention of the impact of council tax support schemes on arrears levels. As funding has reduced, many councils have increased the council tax payments working age households have to make. Many low income households previously on 100% council tax benefit are now having to pay a proportion of their council tax bill.

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