Statement from Moray Council on St Giles Centre debt recovery process

The Interim Chief Executive requested an internal audit be carried out on the circumstances surrounding the build-up and recovery of arrears. This has allowed senior officers and elected members the opportunity to scrutinise the actions undertaken by the council and address any procedural issues arising.

Non-domestic rates (NDR) is a property based tax. The council is the non-domestic rates levying authority for Moray. It is responsible for billing and recovering non-domestic rates monies due on properties. The amount charged is calculated by multiplying the rateable value placed on a property by the Assessor by the rate per pound set by the Scottish Government. As levying authority, the council is obliged to pursue rates recovery in an effective and efficient manner, considering all surrounding facts and circumstances.

Speaking on the St Giles Centre situation, Chair of Moray Council’s Audit Committee, Cllr Scott Lawrence, said: “This report was taken in a private session of the committee due to the potential for further external investigation on the matter and we did not want to prejudice any such proceedings.

“I can, however, confirm that the report covered the debt recovery process for St Giles Shopping Centre Holdings Ltd, including the noting of communications between senior officers from 2022 referencing the NDR arrears and concerns regarding the financial trading position of the Centre.

“The audit trail of available emails, reports, discussions and decisions show senior officers were aware of the economic and social importance of St Giles Shopping Centre and considered the implications any potential closure could have as a result of debt enforcement. The need for the council to support the economic development and infrastructure of Moray was balanced against the debt recovery action undertaken for NDR arrears regarding the St Giles Shopping Centre.

“The report details the extensive communications between senior officers and the Director of Uplands, the Centre management company, in 2022 regarding the increasing arrears and options for repayments. A repayment plan was agreed and when it was not upheld the council had no option but to initiate debt recovery enforcement proceedings. These were suspended for a period to facilitate further discussions around the potential redevelopment of the Centre with the Director of the management company, however when this did not progress enforcement action was instructed to continue.

“Committee agreed with the report finding that concerns about the financial stability of the St Giles Centre should have been raised with full council at an earlier date to afford Councillors the opportunity to consider all the challenging details of the situation. The recommendation to improve record keeping and monitoring of any similar decisions was agreed for all similar cases at a much earlier stage in future. The lessons learned from this audit review has led to the formalisation of recording processes and, as committee chair, I’ll be discussing the recommendations further with the new Chief Executive when she takes up her post next month.

“Should there be any future external investigation the council will provide any information requested.”