Statutory notice charges would have to more than double if the service is to pay its way, council officials have warned.
The controversial scheme, shelved in 2011 following an investigation into fraud and corruption which led to 11 workers being sacked, is set to be reintroduced to prevent Edinburgh’s housing stock from crumbling.
Under the system, the city council paid upfront for repairs to tenement buildings and later recovered cash from owners.
A 15 per cent administration charge was levied by the council to keep the service running, but is understood to have been haemorraghing money, prompting claims it “could not wash its face”.
Now, city officials have issued a warning that fees must soar to 35 per cent to make the scheme self-sufficient. This means repair work worth £20,000 would rocket by an extra £7000 if introduced at City Chambers.
Since the probe was launched three years ago, finance chiefs have commissioned Deloitte to untangle a mess that has saddled the city with £30 million debts from unbilled work.
The auditing firm has so far been paid almost £1m to settle disputes with homeowners and ensure they are billed for work carried out on their properties.
A council insider explained the hiked-up administration fee was an “illustrative” figure based on the service’s running costs, but was not yet being recommended.
The 35 per cent charge may also help to deter homeowners from turning to statutory notices before attempting to resolve the issue themselves.
Council leader Andrew Burns said a series of new measures to help homeowners deal with repair problems – including new advice services and a trusted trader scheme – had been introduced to ensure statutory notices became a “last port of call”.
He said: “Despite all the problems of the previous property conservation service, and we are acutely aware that has been – and continues to be – a very contentious issue, going forward there is a public demand to have an element of compulsion, as an absolute last resort, such as the statutory notices system.
“Enforcement [of statutory notices] will be the last option we look at.”
Enforcement powers would also be wielded by an arms-length company to ensure “distance” with the local authority.
Councillor Burns said: “Hopefully this gives reassurance to the members of the public that we are not replicating the exact structure as before but are responding to what we perceive as quite a strong demand to not throw the baby out with the bath water.” He added that there were “significant risks” in reviving statutory notices, not least the financial impact.
“There will always be an element of trying to recover costs from absentee landlords or owners who don’t want to pay,” he said. “We suffer that now anyway and we can’t sweep that away because we are always going to have that problem in a modern cosmopolitan city like Edinburgh.”