24 January 2012 Last updated at 07:04 ET

North Lincolnshire Council writes off £1m of debts

A council has written off more than £1m worth of debts after it said they were "uneconomical" to pursue.

North Lincolnshire Council said that despite taking legal action £1,098,346 of the debts were "irrecoverable".

The money owed included council tax, national non-domestic business rates (NNDR) and housing benefit overpayments.

The council is cutting £15m from its budget this year following a reduction in its government grant.

In a statement the authority said they were unable to collect the money because "debtors have been declared bankrupt, have died or left the area without trace".

"In other cases debtors have been sentenced to prison due to debts being unrecoverable."

'Benefit fraud'

Councillor Neil Poole, cabinet member for finance, procurement and IT, said: "Every means at our disposal is used to pursue these debts but there comes a point when they have to be written off for this year's accounts.

"Rest assured, there is no place to hide for those criminals who defraud the council and we will relentlessly chase down those who cheat money from law-abiding council taxpayers."

The council said a number of local companies had gone out of business, leaving £495,911 of unpaid NNDR.

Nearly £80,000 of the debt was overpayment of housing benefit, with the council claiming that "much of this has arisen because of benefit fraud."

North Lincolnshire Council said their collection rate for council tax was above the national and regional average.