Agenda item

For the current financial year, the total Council Tax and Business Rates due to Haringey was approximately £254 million, with an expected increase in 2025/26. The council's budget for 2025/26 showed unsustainable financial pressure, with a £67.4 million shortfall before savings. As a result, it remained crucial for the council to explore all options for collecting these taxes.

After issuing a Bill, Reminder, and Summons, and obtaining a Liability Order through the Magistrates Court, the available remedies for recovering unpaid Council Tax included:

• Taking control of goods (Enforcement Agent)
• Attachment of earnings
• Attachment of benefits
• Attachment of members' allowances
• Bankruptcy or winding-up
• Charging orders
• Commitment to prison (only available if an Enforcement Agent had unsuccessfully attempted to take control of goods).

The Local Government Finance Act 1988, Section 62A, and the Tribunals, Courts, and Enforcement Act 2007 allowed for the use of Enforcement Agents to take control of goods following the issuance of a liability order, effective from April 6, 2014.

The Taking Control of Goods Regulations 2013 outlined the procedure for seizing goods under the Tribunals, Courts, and Enforcement Act 2007.

For unpaid Business Rates, the remedies after issuing a Bill, Reminder, Summons, and obtaining a Liability Order were similar, including:

• Taking control of goods (Enforcement Agent)
• Insolvency
• Commitment to prison (only available after unsuccessful attempts by an Enforcement Agent to take control of goods).

The fees for services under this contract were determined by The Taking Control of Goods (Fees) Regulations 2014. The fee structure included three escalation stages, with lower fees for earlier payment of the debt.

The advantages of having this contract included the ability to hold the supplier to the agreed specification. There were concerns about the impact on vulnerable individuals, and questions about what was included in the contract and the services being offered.

It was also discussed whether any social values, such as those related to training and employment, were included in the contract. A question was raised about whether there were other factors or changes we needed to be aware of.

RESOLVED:

It was recommended that the Cabinet Member:

It is recommended that Cabinet Member for Finance and Corporate Service approves, pursuant to Contract Standing Order 7.01(b) (use of compliant Framework) and 9.07.1d, contract awards to CDER Group Limited, Newlyn Plc, Martson (Holding) Limited and JTR Collections Limited for the supply of Enforcement Agent services to the London Borough of Haringey for a period of 3 years with the option to extend for further period of up to 1 year.

Reasons for decision

3.1 This report follows the successful completion of a further competition in accordance with the rules of the Yorkshire Purchasing Organisation (YPO) procurement Framework No.1200 Enforcement Agency Services.

3.2 As a billing authority, the London Borough of Haringey is responsible for the Levy, Collection and Recovery of Council Tax and Business Rates.

3.3 Enforcement activity which will take place under these contracts will increase essential council income from Council Tax and Business Rates from individuals who are in arrears and have the ability to pay.

3.4 The services provided under these contracts will be at no monetary cost to the council as these are concessions contracts. The fees the Enforcement Agencies can charge in the recovery of the debt are determined by legislation (see 6.2).

3.5 All four suppliers have demonstrated commitment and ability to identify vulnerable customers in order that pursuit of debts from those individuals is halted and returned to the council, and that they receive the necessary support from their dedicated welfare teams, to comply with Haringey’s Ethical Debt Reduction Policy.

Alternative options considered

Ceasing to use Enforcement Agents would create a loss of millions of pounds to the Council through unpaid taxes which the council and the borough cannot afford, and under the terms of the operating agreement in place with Future Wood Green Ltd, we are required to recover unpaid BID Levy through use of Enforcement Agencies.

We currently use two Enforcement Agencies (CDER and Newlyn) for Council Tax, NNDR and BID Levy through Service level Agreements (SLAs). Continuing this arrangement would not offer us the same level of value and protection as a contract secured via a competitive procurement process.

The introduction of a contract with clear specification and code of practice (Appendix 1) enables improved assurance regarding the standards, performance and compliance of suppliers and a clear framework for contract management by the service.

Operating an inhouse Enforcement Service would require the council to develop a specialism that it does not currently have, and would require significant upfront investment into infrastructure, recruitment and training. Research into this option found only one model currently operating in London, by OneSource, a shared service partnership between the London Boroughs of Newham and Havering