### Wales Sees Surge in Council Tax Arrears, Now Topping £160 Million
Wales is grappling with a dramatic increase in unpaid council tax, as recent figures reveal arrears have more than tripled over the past decade. Data published by the Welsh Government shows that the value of outstanding council tax broke £160 million at the end of the 2024-25 financial year, up from just under £48 million ten years earlier. This growing shortfall comes at a time when households themselves face significant cost-of-living pressures, further complicating the collection of these essential local funds.
Council tax underpins the delivery of crucial local services, including social care, waste collection, and park maintenance. When households fall behind on payments, local authorities often have no choice but to pursue legal avenues to recover what is owed. Thousands of Welsh residents have found themselves brought before the courts over unpaid bills. These arrears present both a personal stress for the individuals involved and a substantial financial challenge for the 22 councils across Wales.
As 2024-25 drew to a close, the total amount of unpaid (or “outstanding”) council tax – which takes into account late “in-year” payments as well as previous years’ debts – soared to £263 million, a figure up threefold from the £83.9 million seen a decade ago. While council tax rates and the cost of public services have risen steadily year on year, various schemes exist to help those entitled to reductions, including discounts for people on low incomes, those living alone, or individuals with disabilities.
Swansea Council currently tops the league table for council tax arrears, reporting £17 million in unrecovered payments at the end of 2024-25, and a striking £26.3 million in total outstanding council tax. Cardiff and Gwynedd also posted high levels, with each reporting arrears exceeding £13 million and similar totals for outstanding amounts. Larger urban councils typically see the highest absolute arrears, though this is not always directly linked to rates per household.
Despite these stark figures, council officials are quick to defend their record on recovery. Swansea Council, for example, describes its approach as “progressive” – offering extended repayment timeframes to those struggling, which they argue has successfully allowed more people to clear their debts without defaulting. Nonetheless, the authority notes that court action is initiated as a last resort when other options are exhausted, and nearly 20,500 summonses were issued over the most recent two years.
Collection rates across Wales remain relatively robust, with an average of 95.6% of council tax set by local authorities recouped in 2024-25. However, this figure has slipped slightly from the 97.2% average recorded ten years previously. The COVID-19 pandemic, rising energy prices, and broader inflation have all contributed to the squeeze on household budgets since then, pushing more families into arrears than before.
This increase in arrears is further magnified by the fact that the total council tax set by Welsh authorities has grown dramatically – rising from £1.28 billion ten years ago to £2.33 billion in the latest financial year, representing an 82% increase. The impact of collecting a slightly lower percentage of a much higher overall sum has led to increasingly sizeable shortfalls, posing tough questions about the sustainability of funding for essential services.
The Welsh Local Government Association (WLGA) and local councils accept a certain level of non-collection when setting budgets. Authorities such as Swansea report that they sometimes exceed their conservative recovery targets, with historic debts being reclaimed and factored into future finances. Yet, when cash falls short, councils are often forced to contemplate difficult choices: trimming services, raising additional charges, or dipping into reserves.
Meanwhile, reforms may be on the horizon. The passage of the Local Government Finance (Wales) Act is set to trigger regular property revaluations starting from 2028, aiming to make council tax more equitable by better matching rates to the present housing market. While these changes promise more fairness, they are also likely to produce winners and losers as outdated property bands are updated.
The Welsh Government highlighted its efforts to ease the pressure on vulnerable households, with its council tax reduction scheme assisting nearly 260,000 people last year. Nonetheless, officials acknowledge that many families are still struggling amid challenging economic conditions.
As council budgets remain stretched by rising demand for social care, education, and housing support, the debate over council tax’s future looks set to continue. In the meantime, authorities encourage anyone in difficulty to get in touch and explore the help available before arrears become a bigger problem. For those in need, early engagement is considered the key to finding manageable solutions and preserving the public services so many rely on.