Barking and Dagenham (Parliament Politics Magazine) – Barking and Dagenham Council has written off tens of thousands in unpaid business rates owed by Poundland after efforts to recover the debt failed.
The budget shop owed £135,000 in unpaid rates for the first quarter of this year, according to documents that were sent to council leaders earlier this month.
Due to a plan to keep Poundland out of administration, the Barking and Dagenham council has since assured the Local Democracy Reporting Service (LDRS) that just a “small portion” of this will be paid.
Earlier this year, Poundland was on the verge of bankruptcy until it was purchased by Gordon Brothers, a US investment group, in June for £1.
In addition to closing 68 stores, the High Court authorized a recovery plan that included writing down business rates owing to authorities.
Business rates would only be paid to councils for a maximum of six weeks.
Additionally, they would receive compensation based on what they might have received in the event that the business went out of business and what they might have received in the event that another store had opened.
Until April 2026, Poundland would not be required to pay business rates.
According to a report given to council officials earlier this month, “Poundland has an outstanding balance of £135k between April and June.”
Action to collect the debt was “suspended while the company explores refinancing opportunities,” according to the statement.
Both of Poundland’s locations in the borough East Street in Barking and Heathway Shopping Centre in Dagenham are covered by the debt.
A council spokesperson told the LDRS today (Friday 31st) that the recovery plan meant only “a small portion of the business rates owed would be paid”.
They added:
“The remainder is considered ‘void’ up until March 31 2026.”
A spokesperson for Poundland told the LDRS that the write-off was necessary to save more stores from closure.
They said:
“The high court sanctioned the plan which covered the compromise of rent and rates, agreeing that it was necessary for Poundland so it could stabilise the business, securing the future of hundreds of stores and thousands of jobs.
The bottom line is without the restructuring plan being approved, sadly the business would have likely gone into administration.”
The spokesperson added:
“We’ve appreciated the engagement of all our creditors throughout the restructuring process and are now working hard to create the simpler, more focused Poundland that will get us back to growth.”
How much business rates debt was reported for Barking and Dagenham?
The amount of business rates debt reported for Barking and Dagenham related to Poundland is described as “knockouts of thousands of pounds” written off by the council. While exact numbers for the entire city’s business rates debt are n’t specified in detail, this write- off specifically addressed overdue rates owed by Poundland.
More astronomically, Barking and Dagenham Council reported a business rates collection rate of 81.4 by the end of Quarter 3 in 2024- 25, showing enhancement over former times but indicating some arrears remain.
The council has been laboriously managing debt recovery and supporting residents and businesses facing fiscal difficulties post-pandemic, but the specific total outstanding business rates debt for the whole city is n’t detailed intimately in the available reports.
