Crippling Burden of Council Rent Arrears; LOCAL AUTHORITIES AT CRISIS POINT AS DEBT HITS [Pounds sterling]40MILLION

Daily Mail (London), November 11, 1998 | Go to article overview

Crippling Burden of Council Rent Arrears; LOCAL AUTHORITIES AT CRISIS POINT AS DEBT HITS [Pounds sterling]40MILLION


Byline: HAMISH MACDONELL

SCOTTISH councils are in the grip of a potentially disastrous financial crisis because of crippling housing debts, it emerged last night.

Official figures revealed that local authorities are owed almost [pounds sterling]40million in back rent as thousands of tenants across the country refuse to pay rent arrears stretching back several years.

At the same time councils owe banks and the Exchequer more than [pounds sterling]6 billion - about the same debt of some small third world countries - much of this from expensive housing projects 20 or 30 years ago.

It is estimated that interest pay-cost councils more than [pounds sterling]550,000 a year.

Glasgow's debt problem is so acute that half of all council house rents paid to the council are used up just paying off the interest, not reducing the size of the loans themselves.

The Government defended the local authorities yesterday, insisting that many of the debt problems had been around for many years and did not demonstrate bad management.

But o p p o s i t i o n p o l i t i c i a n s demanded urgent action to deal with the problem.

The Tories claimed councils had 'encouraged a culture of non-payment' after the new figures showed that one in three council house tenants in Scotland had fallen behind in their rent.

There are 621,291 council house tenants in Scotland and some 228,426, are in rent arrears.

Spokesmen for Edinburgh, Glas-the councils were doing everything possible to recover the arrears but this was very difficult in many cases.

Conservative local government spokesman Iain Whyte said it was 'disgraceful that Old Labour in local government' had allowed such debts to build up. …

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