Ombudsman highlights 'council tax bankruptcies'

08/10/2009

Local authorities have been too harsh on indebted residents, Local Government Ombudsman reports suggest.

Two councils have been criticised by the Local Government Ombudsman for beginning bankruptcy proceedings against people who fell behind on council tax payments.

Manchester City Council was found by the organisation to have a "fundamental flaw" in its policies.

The authority had been the subject of a complaint from a local resident, after he was made bankrupt through non-payment of the tax in 2007.

'Mr Joseph' (not his real name) claimed that he had not even been informed of the proceedings and did not owe any other debt to the council.

Local Government Ombudsman Jerry White said that council officers did not have a written policy on the issue of whether or not bankruptcy was an appropriate course of action for council tax non-payment.

"I consider it maladministration for an authority not to have such a policy … in such an important area of public administration," he commented.

Meanwhile, Newham Council in East London was found in a report by Local Government Ombudsman Tony Redmond to have made a local woman bankrupt for council tax non-payment, even though she was mentally ill.

The woman, whose illness prevented her from managing her finances properly, was later granted an exemption from bankruptcy.

Council policies on the issue have also since been changed.

Mr Redmond said: "I commend the council for its rapid and appropriate action."

Tags; Income Worries and Debt, Credit Card Lifestyle, Recent Graduate Debt, Retirement Money Problems,

Regional Debt Advice; Debt Help East London, Debt Help London, Debt Advice Chester, Debt Advice Manchester,

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