Police chiefs count cost of losing gangster tax millions

Concerns that an anticipated £6m will no longer be available to force

POLICE chiefs have given up on securing any “gangster tax” to fund their force this financial year.

The new national force’s 2014-15 budget had assumed income of £6 million from dirty money seized from criminals.

However, with just five weeks of the year left to run, the funding under the Proceeds of Crime Act, or Poca, has failed to materialise.

Police Scotland still aims to balance its budget this year thanks to “over-provision” of police salaries and additional savings.

But Chief Constable Sir Stephen House has summed up his view of the shortfall as a “disappointment”. Appearing before his main watchdog, the Scottish Police Authority (SPA), he said it was now unclear if it was realistic to raise enough money from Poca to fund the police.

The force was also understood to be counting on such funding in the coming financial year.

Sir Stephen had struggled to get political support for a “gangster tax” with former Justice Secretary Kenny MacAskill and other politicians raising worries that the policy would incentivise the force to chase cash rather than pursue successful convictions.

The force, under current rules approved by the Scottish Government, is allowed to keep money raised over a certain sum, with the rest continuing to go to a fund to help disadvantaged communities.

Quizzed by SPA members, Sir Stephen tried to explain why this had not happened, despite vast sums “frozen” by authorities.

The force, by the beginning of February, restrained some £113m in dirty money, denying access to it by alleged and c onv ic t e d criminals.

This is more than the target for the whole financial year of £108m.

Sir Stephen, citing analysis of a number of cases, said there was a “degradation” in sums that were restrained compared with those passed on to public funds.

He said: “Indicatively we are starting off with hundreds of thousands of pounds and ending up with mere tens of thousands coming through to the public purse.

“I know the Crown are putting a great deal of focus on this.

“But we have not seen – yet – the funds come through.

“The question that needs to be asked is ‘is this just that it is taking longer through the pipeline’? Or is it coming through in the timescale expected – between a year and 18 months – with a much smaller value on the end?

“Are we overestimating? Or is there too much deterioration of the value as it goes through the system?

“The order of the reduction is far, far greater than we expected.

“It is not as good a performance as we expected but the principle is still sound.”

Supporters of Poca stress that it remains a vital tool in disrupting criminals, star ving them of resources, and was never seen primarily as a source of funding.

Police financial officials, mean- while, insisted they could still balance the budget as salary take remained below expected levels.

The force, however, has just over a month to identify a recurring cost reduction target of £4.2m this financial year.

This is before it tries to balance its budget next year.

The SPA and the force still officially rank failure to make necessary cuts as “high risk”.

And the SPA this weekend formally warned that its 2016-17 budget faced a crisis after the anticipated end of a special “reform” budget granted by the Scottish Government to help it deliver savings from the merger that created the single force.