South Ayrshire Council is changing the way in which it collects outstanding debts from former tenants that it has no forwarding address for, and entering into a 12 month pilot project with Westcot Credit Services Limited.

In April 2003 Communities Scotland recommended that the Council review the effectiveness of the Former Tenant Arrears Procedures. Internal Audit had already recommended that the Council investigate the possibility of using debt collecting or tracing agencies to recover outstanding debts.

Vice Convener of the Council’s Social Justice Committee, Councillor John McDowall said: “The Council has a duty to all of their tenants to recover former tenants outstanding rent arrears.

“It is important that former Council tenants who are in rent arrears, and move leaving no forwarding address, realise that their debts will have to be paid.

“Agencies such as Wescot Credit Services Limited have the resources and the mechanisms to effectively trace debtors with former tenant rent arrears, and they will not charge for their services if they do not successfully trace the former tenant.”

Several debt collection agencies were consulted during the review of the Council’s Former Tenant Arrears Procedures. A cost and benefit analysis of each agency was carried out and Wescot Credit Services Limited was found to be the most cost effective.

During the pilot project only those cases with no forwarding address and balances greater than £150 will be passed to the tracing agency. It is estimated that twenty cases each fortnight will be passed to the tracing agency.

Once forwarding address details have been obtained the case will follow the normal Former Tenant Arrears recovery procedure. Currently the majority of cases that are passed to Committee for approval to write-off, have no forwarding address on file, therefore the success of this pilot will be easily measured as it should result in a gradual reduction in the number of cases passed to Committee for write-off.

At the end of the twelve month pilot project an evaluation report will be prepared by Officers of the Council and presented at a Social Justice Committee.

The costs involved in the pilot project will be met from existing provisions within the Housing Revenue Account budget.

March 2005