Roscommon council is highest spender on debt collectors

Roscommon County Council spent more on third-party debt collection agencies than any other local authority last year, according to new figures.

Research carried out by The Irish Times shows that more than a third of councils use external companies to recoup outstanding payments owed, with Roscommon and Leitrim becoming the first counties to openly tender for professional debt collectors in 2012.

The council paid €92,500 to three agencies in 2014, far more than any other local authority.

Other councils which spent significant sums included Westmeath (€56,400) and Donegal (€37,125), while Dún Laoghaire-Rathdown County Council (€41,000) was the only Dublin-based authority to use debt collectors.

The firms called upon to follow up on businesses and, in some cases, individuals who had fallen behind on domestic payments include a subsidiary of US-based media and financial services giant Bertelsmann; law firms specialising in debt recuperation such as AB Wolfe Solicitors; and credit-checking and reporting group Stubbs Gazette.

Sources in various councils indicated that officials from the Department of Environment are encouraging them to put a more concerted effort into collecting money owed, saying that a failure to do so may result in future spending shortfalls the department will not cover.

Boycotters

With the issue of non-payment of domestic water charges looming, it is thought Minister for the Environment Alan Kelly is keen to see authorities equip themselves with adequate expertise to deal with the potentially large number of boycotters.

Responding to a query from The Irish Times, a spokesman for Roscommon County Council said third-party debt collectors were called upon only as a "last resort".

“Careful consideration is given before passing the case to a legal agent and [that] only happens when a customer refuses to engage with the county council,” he said.

“We have discussed this issue many times with elected members and have always insisted that where possible, Roscommon County Council would like to avoid these costs.”

Arrears

The figures show that some local authorities which have accumulated large arrears due to businesses and members of the public not paying fees for services have not elected to go down the same route as Roscommon.

According to Rúairí McGinley, an Independent councillor who chairs Dublin City Council's finance strategic policy committee, the authority is competent when it comes to collecting commercial rates but not when it comes to bringing in outstanding fire brigade callout charges, of which less than half of the €1.18 million owed last year was paid.

“Once the service is delivered, an amount is due and we shouldn’t be shy about trying to collect the money,” Mr McGinley said.

“Waiting for a couple of years and then putting debt collectors in is a bad idea, but having them as part of process is good . . . More money will be raised than it’s going to cost so from the council’s point of view it’s a good thing,” he added.

Former city councillor and current TD for Dublin South Central Joan Collins disagrees, saying the use of third parties to collect payments for State bodies is indefensible.

“They should be pursuing it with the people themselves rather than going to third-party debt collectors,” Ms Collins said.

“We’re dealing with the end product of councils not being properly funded by the Government,” she added.