A public sector payments specialist has claimed that local government has a responsibility to offer the widest possible range of payment options if it is to successfully collect all council tax.
Ross Macmillan, market intelligence consultant at allpay, made the comment following an announcement from the Audit Commission, which claims that £1.21bn of council tax and business rates went unpaid in the financial year that ended in March.
Furthermore, £3.34bn is still owed from previous years according to the auditor, which aims to “protect the public purse.”
“Increasing the attractiveness of payment methods and offering the widest choice of payments has shown to be a successful strategy for improving collection rates effectively,” claimed Macmillan.
“The use of national networks – such as PayPoint and the Post Office – has shown to be a cost-effective way of collecting payments compared to accepting payments in-house.
“It also offers councils an immediate increase in the number of outlets where citizens and firms can pay their bills and is an especially important option for those without bank accounts or who are used to budgeting in cash,” he added.
The benefits of offering flexibility in payment options is a subject Macmillan has discussed before – he believes it could also transform the troubled Universal Credit benefits programme.
Besides noting that Direct Debit is not an appropriate payment method for everyone receiving the benefit, Macmillan also noted social landlords and local authorities should have access to claimant information to better help them support their clients.
The market intelligence consultant offers similar thoughts in relation to council tax collection.
“Councils the past have encouraged council tax payment by Direct Debit to improve collection rates, but that doesn’t always fit every demographics. For those who have started making council tax contributions – following the introduction of the local council tax support (CTS) schemes – direct debit schemes do not always work,” claimed Macmillan.
He also believes that local councils should offer alternative options such as smartphone payments, noting that many local government bodies now opt to send barcoded letters or payment cards that allow citizens to pay in a much more flexible manner.
“With a smartphone payment, citizens can scan the barcode on the letter, and then make a payment using their bank card for an amount they know they can afford, as soon as they receive the correspondence,” Macmillan claimed.