Margaret Hodge: Government Failing to Collect £22bn Debt

The Government has been neglectful about collecting £22bn of debt owed to certain of its offices and and tends to make large, periodical write offs, according to the Public Accounts Committee (PAC).

PAC chair Margaret Hodge said: "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."

Around £15bn ($25.7bn, €18.9bn) of that debt is owed to HM Revenue and Customs, with money outstanding to the Ministry of Justice and the Department of Work and Pensions making up most of the rest, and whilst finances are still tight following the recession the PAC says that now is the time to collect.

However, Hodge added that she was particularly concerned about the risks of vulnerable debtors being pursued inappropriately.

"The current climate of tight public finances must be an opportune time to make the lasting change to debt management that is needed across government," said the accounts committee.

"This will require prompt action to obtain repayments earlier, real co-operation across departments, better data for a more detailed understanding of debtors and their circumstances."