Doncaster Council owed over £20million in council tax as Covid-19 leads to rise in arrears
The amount of money owed to Doncaster Council in businesses rates and council tax has increased due to the financial impact of the coronavirus pandemic.
New figures seen by councillors show the council is owed over £20 million in council tax and around £5.6 million in business rates.
The suspension of council tax recovery and enforcement action continued throughout the second financial quarter (July-September) and an increase in non-payment was also caused by the ‘continuing uncertainty around jobs’ due to the pandemic, finance bosses said.
The outturn collection of Business Rates at the end of the second quarter is estimated to be 93 per cent – a reduction when compared with 97 per cent for the same time in the previous year.
New data shows that 1,000 businesses are behind with their business payments for the year but finance chiefs added that ‘no formal debt recovery action’ has been taken against such businesses and ‘efforts continue’ to work with those to come to alternative payment plans.
In total, £34.7 million is expected to be received from central government as un-ringfenced grants to help the council deal with the additional costs and income shortfalls related to Covid-19.
Sennette Wroot, DMBC’s senior policy & insight manager, said: “ “The suspension of recovery and enforcement action continued throughout the quarter and for many businesses, uncertainty over the economic climate has seen an increase in non-payment.
“Many businesses have had to close and even though lockdown measures have now eased, the potential of further closures and what will happen.
The impact of the Covid-19 pandemic has seen many businesses continue to struggle despite the easing of the national lockdown.
“With the continuing uncertainty over local lockdowns and their impact on businesses, it is anticipated that collection will remain difficult in quarter 3.
“The financial position remains volatile and costs could increase further as the government guidance changes and the financial impact of restrictions become clearer. It is important that managers keep a strong grip on their budgets as events unfold.”