THE local authority has been forced to write off more than a quarter of a million pounds in uncollectable debts — the majority of which is down to companies going bust.

On Wednesday, April 17, Test Valley Borough Council’s cabinet approved wiping out £310,975 in unpaid business rates debts, accrued by businesses and one individual.

Of that, £36,026 was due to a bill sent in error and not in accordance with regulations.

A report to cabinet last week said: “Professional advice was sought following identification of this error that confirms there is little chance of any recovery if the amount owed is pursued through the courts.”

Much of the uncollectable sum has been built up after five companies either went into liquidation, administration or dissolved.

“It is inevitable that it will be necessary to write off certain amounts as uncollectable when businesses go into liquidation and have arrears owed to the council,” the report added.

Formally based on Walworth Industrial Estate, SLS Metalworks Ltd owed £29,526 before it appointed liquidators in November 2018, while £58,337 was owed by Arensis Energy Ltd.

Shoe company Brantano Retail Ltd owed £59,547 to the council, with Romsey-based Warren-Morrison Valves Ltd in arrears by £33,842.

And QA Logistics Ltd, which was based in East Portway Business Park, had an outstanding debt of £67,415.

But £26,282 belongs to an individual – who has not been named in the report – who went into bankruptcy.

Despite the council working to collect the debts, it says there is “little or no prospect of future recovery”.

Of the £310,000 worth of debts, the authority says that the actual cost to the authority is expected to be around £50,155.

This is in part due to other organisations sharing the cost of the debt and amounts already provided from previous years’ accounts, along with reduced levy on business rates growth.

The report added: “The total estimated business rates payable in 2018/19 was £56.35m. After allowing for amounts already taken into account in previous years, the amount recommended to be written off is 0.4 per cent of the total estimated income.”