The Treasury Minister believes the system by which local authorities collect rates ‘needs improvement’.

Alex Allinson says the total value of unpaid rates as of March 15 was £3,156,955, adding that a proportion of this is historic and has accumulated over several years.

The minister was answering a question posed to him in Tynwald last week as Treasury currently collects rates on behalf of local authorities.

He was asked how much of this debt is passed onto coroners, to which he said that £100,670 was passed on for the year 2019-20.

For 2020-21 no recovery stages took place due to the pandemic and ratepayers were given the option to defer payments.

During 2021-22 recovery stages were not fully reinstated until the end of the that year.

Dr Allinson said that as this process is time-bound, all prior small claims procedures had expired, so Treasury restarted the process in 2022-23.

As a result, during 2019-20 the amount of rates paid following action from the coroners was £43,557, in 2020-21 it was £34,044, and £41,665 in 2021-22.

Collection rates currently are more than 95%, meaning, as Arbory, Castletown and Malew MHK Tim Glover suggested in Tynwald, there are a ‘relatively small number of debtors’.

He asked why coroners hadn’t taken action and if the system was fit for purpose.

Dr Allinson said: ‘Most people do pay their rates, they pay them on time.

‘Rates are a very important income for local authorities to provide essential services to their communities. The reasons people may not be able to or not want to pay rates are diverse and need to be looked at as a whole.

‘When you look at the rates over the years they vary due to local authorities but they particularly hit smaller local authorities more significantly.

‘Some of these debts are historic and go back a number of years. In those cases there is often a charge on the property so that when it is eventually sold that money will be returned to the local authority.’

He continued: ‘That obviously does not help them with their cash flow in the short term.

‘I don’t think the system is broken but I do think it needs improvement. We will be increasing coroners fees and making sure their services are resourced properly.

‘Treasury intends to prepare a general public policy consultation document, seeking views on the powers, procedures and functions of the coroners.

‘We will bring that forward and try to get that consultation done prior to the summer recess of Tynwald.’

Rushen MHK Michelle Haywood said it was important he had acknowledged that this put pressure on local authorities ‘because it does, in some cases, amount to 5% of the overall expected revenue for those local authorities’.

She said: ‘The deferred payments due to Covid did have an impact but there are five local authorities who experienced a higher level of outstanding debt in 2021-22 after the Covid period had finished.’

These were Ballaugh, Bride, Lezayre, Rushen and Castletown.

Dr Allinson said that during Covid, ‘debt collection was not seen as appropriate when some people were running into quite serious debts’.

‘I think we have managed to catch up a good amount since then but there are some legacy issues around that,’ he added.