Agenda item

The Committee considered a report on Income Management.

In the ensuing debate, the following points were made:

·         Niki Hardman, Programme Manager explained that an overall Council debt position of £30m had been recorded in October 2020. This had since been reduced but there remained a significant amount of work to complete, particularly around aged debt. The aim of the debt team was to engage the whole of the council but in particular those involved in the raising of debt by increasing awareness and encouraging officers to take greater responsibility for debt management in their role. A revised Corporate Debt Policy would be formulated. It was acknowledged that not enough debt was being forwarded to legal services and processes were being reviewed to improve that. The total amount of debt for the top 20 debtors was now £6.7m reduced from £14.8m in October 2020. Mark Sanders added that debts which related to individuals in a social care setting were treated with a greater degree of care and due diligence

·         There were a number of large organisations included in the aged debt list. At what point would the Council commence sanctions against these companies, for example no longer commissioning work from them until the debt was paid? An action plan needed to be in place showing how organisational debt (excluding individual debt) would be recovered and what possible sanctions could be introduced (without compromising the Council’s legal position). This action plan should be reported to the Committee. Michael Hudson responded that an action plans had been formulated for each aged debt and legal services had been brought in to help take these strategies forward. He anticipated that by the next Committee meeting, significant progress would be made on aged debt. The action plans could be shared with the Committee albeit respecting the confidentiality of the information

·         A note of caution was raised about the introduction of sanctions against aged debtors. The council needed to be conscious of its own debt arrangement before considering the introduction of sanctions

·         The lack of referrals to legal services was concerning, given that a number of the aged debts had accrued over a long period of time. It seemed that the longer the debt accrued, the more difficult it became to resolve them

·         Catherine Hitchman, Principal Solicitor (Adult Social Care Education and Debt Recovery Team) explained that a legal team had been established and been working closely with the debt team to establish debt referral and management processes. Two main types of debt had been referred to legal services. Firstly social care debt which equated to £93k and mostly related to deceased individuals with the charge on their estate for payment of social care costs. £61k of this debt had now been recovered. Secondly, there was sundry debt which amounted to £13k. 63 cases had been referred to the legal team since the start of the year. To date no cases had been issued to court. Legal Services would continue to work with the debt team to formalise a Corporate Debt Policy and a write-off policy

·         In response to a query about the approach taken in a particular case where the Council had instructed a private solicitor to recover debt on its behalf, Michael Hudson advised that details of this specific case would be provided to individual members in confidence as requested

·         The Chairman expressed his gratitude to senior officers for taking the Committee’s concern about outstanding debt seriously. He was reassured that, with the greater resilience in the system and the establishment of the debt and legal teams, the remaining outstanding debt would be addressed going forward. He emphasised the importance of early intervention in debt recovery and welcomed the introduction of a Corporate Debt Policy. The centralisation of debt recovery had been important but all directorates had to take responsibility for debts accrued in their service area. He recognised that reluctantly a certain amount of debt would need to be written off. He did not believe that sanctions for debtors was the way forward but would wish to see action plans for the top 20 aged debts at the next Committee meeting.

RESOLVED thatthe Income Management report be noted.