Hansard

It is not a breach of the principle that I have espoused. Mr Brown should look at the data that is available to Parliament. I take one particular example: Angus Council ceased to collect any community charge arrears in 2008-09—that was the last time that any community charge arrears were collected. It has declared that £3,627,000-worth of uncollected poll tax debts still exist in Angus. The point that I am making is that a tax that existed for four years, was the subject of massive political controversy and ended over 20 years ago is now incapable of being collected.

I have given one local authority example, but I can give other examples. No poll tax debt has been collected in recent years in Falkirk, the Western Isles, Shetland and Orkney. I simply make the point that the poll tax fell into disrepute at the time and significant periods have elapsed in which there has been no practical proposition to collect or practical capability of collecting anything like a substantial proportion of the existing arrears. The Government is therefore taking a practical step to remedy the situation.

Despite collections being pursued, around £425 million of community charge still remains uncollected from the four years in which the charge operated in Scotland. Almost all of that £425 million can no longer be collected. In the 20 years that have passed since the community charge was abolished and replaced by the council tax, many people have moved home—even moved away from Scotland—married, changed their name or even, sadly, deceased. They could not now be traced and linked to a debt. Even if a person could be traced, the local authority cannot pursue the debt any further if no attempt has been made to recover outstanding arrears from the debtor in the past 20 years.

In 2013-14, the authorities that still collected community charge debts collected a total of only £327,000. Ten authorities have decided that their share of the £425 million is just not going to be collected. The last stand for the poll tax that Mr Brown is deploying is indicative that the Conservatives have perhaps not moved on terribly far from the application of the poll tax all those years ago.

The community charge that was collected declined from £1.3 million in 2009-10 to £327,000 in 2013-14. If we project that declining rate of collection forward, we can easily see a point at which the costs of collecting become greater than the sums that are collected. Local authorities tell us that the total that they can recover under existing recovery arrangements is £869,000. Councils will receive their share of that £869,000 in 2015-16 by agreement between the Scottish Government and COSLA.

We have given a reasonable length of time and a reasonable opportunity for historical debts to be collected, and a point has been reached at which we must all recognise that the community charge has entirely run its course, despite the affection in which it seems to be held by the Conservatives.

In its stage 1 report, the Finance Committee asked why we did not request information

“on the value of community charge debt that was recovered through informal or sporadic payments”

in order to include that in the settlement to local government. There is no reliable means of estimating that because, by their nature, the payments are informal and sporadic. However, we can look at the pattern of payment of poll tax arrears, which, as I have indicated, shows that payments have steadily declined year by year. In 2013-14, the last financial year for which data is available, payments totalled £327,000, down from £512,000 the previous year, which was down from £923,000 the year before. The payments are petering out significantly.

For years after the community charge’s abolition, collection rates for it and the council tax, which replaced it, were lower than those for the domestic rates which the community charge replaced. I can understand that there may be concern that the legislation will have a similar effect; indeed, local authorities expressed that concern in their submissions to the Finance Committee. However, people objected to the community charge because that tax bore no relation to what people could afford to pay.

Council tax liability is linked to ability to pay through the council tax reduction scheme, which supports those on low incomes to meet their council tax liability in so far as that is possible. The poll tax’s collection rate was around 88.4 per cent; the council tax’s in-year collection rate is 95.2 per cent—that is the rate for the immediate year in which the liability arises. The expectation is that in excess of 97 per cent of council tax will be collected once follow-up mechanisms are used to ensure collection.

Those paying off community charge debt include some of the poorest and most vulnerable who were unable to pay at the time and are now paying small sums towards arrears every week or having them deducted from social security benefits, which, in some cases, will be their only income source. More than 20 years after the community charge was abolished, it could still be many years before some of the debts are cleared.

The independence referendum inspired record numbers of people to register to vote. Many of those people had not voted for decades; others had never voted before. We do not want people to fear being on the electoral registers because of decades-old debts from discredited legislation. The bill will help to avoid that and will ensure that everyone’s voice continues to be heard.

None of that detracts from the clear view that I and the Government hold that people should properly pay the taxes for which they are liable. It is for each local authority to determine the most appropriate means to recover council tax debts. I would expect them, when deciding how to pursue their debts, to do so in a way that is sympathetic to the debtor’s needs and circumstances.

The bill is one step that the Scottish Government is taking to make local taxation fairer; the independent commission that we are establishing in partnership with local government to examine fairer alternatives to the council tax system is another step.

Many members of the public have written to their MSPs, the First Minister and me, pointing out that they paid the poll tax, even though they disagreed with it in principle and despite whatever hardship that may have caused them. They ask that the Government address the issues associated with the abolition of the poll tax. The Government is doing that in the legislation.

The poll tax is a defunct tax; it is a discredited tax. Local authorities are pursuing increasingly historical liabilities that crystallised more than 20 years ago, and we can all see from the data that the amount collected is petering out year by year. There is a necessity to consign the poll tax to history once and for all. That is the action that Parliament has before it. I encourage members to support the motion.

I move,

That the Parliament agrees to the general principles of the Community Charge Debt (Scotland) Bill.