MPs Demand £22bn In Unpaid Debts Be Collected

A report by MPs has slammed the Government for failing to chase down at least £22bn of debts owed to the Treasury.

The Public Accounts Committee was reacting to an earlier study by the National Audit Office which calculated, that of March last year, £15bn was outstanding from HM Revenue and Customs.

The Department for Work and Pensions and the Ministry of Justice accounted for most of the remainder.

Margaret Hodge believes taxpayers are being failed

The MPs accused ministers of failing to take a strategic approach to the issue and warned that failure to minimise the volume of debt outstanding - ranging from unpaid fines and taxes to overpaid tax credits - was having a direct impact on Government borrowing volumes.

They recommended each department was given targets to recover what debt they could though vulnerable debtors should not be pursued inappropriately.

Committee chair Margaret Hodge said: "The Government is owed this massive amount of money but it has failed to take a strategic, cross-government approach to managing that debt and getting more money paid to the Exchequer".

The report added: "Government inaction has led to large volumes of old debts building up in departments which are unlikely to be collected.

"While the Treasury and the Cabinet Office say they are belatedly developing a cross-government strategy for debt, we are concerned that the centre has taken so long to drive improvements in debt collection, given that this should be a basic business activity, and given the huge volume of bad debts that are written off each year".

Another conclusion suggested departments review their use of debt collection agencies.

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