Government is to outsource some debt collection services after revealing it is owed $24.5 million in payroll tax and $10.5 million in land tax.

Finance Minister Paula Cox said outsourcing of land tax debt to debt collectors will begin with a pilot project next month.

The news comes after the House of Assembly's Public Accounts Committee (PAC) raised concerns about the increase in land tax more than 90 day's late.

In 2004 the total owed stood at $7.2 million, in 2005 it grew to $8.2 million and in 2006 it hit $10 million. Late pension contributions increased from $14.9 million in 2004 to $15.4 million in 2005, but showed a $1 million improvement in 2006 when they dropped to $14.4 million.

Late payroll taxes dipped from $17 million in 2004 to $14.5 million in 2005 only to bounce back up to $17.8 million in 2006.

The PAC, in its recent report, said: "Unpaid pension contributions impact the employee's ability to enjoy full pension benefits."

And it urged aggressive action to recoup the money, including where necessary, prosecutions by the Attorney General's Chambers.

Ms Cox responded in the House of Assembly on Friday by unveiling a project to outsource some land tax debt collection. She said: "The project will entail the transfer of the most delinquent taxpayers to the credit companies."

And an amnesty programme for delinquent payroll taxpayers will begin before September 2009 waiving, under certain conditions, penalties and additional taxes from outstanding payroll tax.

The Tax Commissioner will also get new accounting software, ready for use by Spring 2011, said Ms Cox to help him in his efforts to recoup money. She added: "This Government places a high priority on collecting outstanding amounts owed."

Government's Debt Enforcement Unit (DEU), operating under the Attorney General's Chambers, had been operating aggressively during the current fiscal year with around 31 summonses issued and served over pension and tax arrears, said the Finance Minister.

The DEU obtained 21 judgments for a total of $698,956. Letters before action and/or summonses assisted in negotiated payment plans totalling $439,820. She said the office of the Tax Commissioner collects the majority of the Consolidated Fund's annual revenue and had a Debt Management Section consisting of three staff.

"They have successfully instituted garnisheeing of salaries and rents in relation to land tax.

"They have also used the offsetting provision in the legislation that allows them to claw back any monies due to Government from companies who are awarded Government contracts (i.e. Work and Engineering contracts).

"They have set up instalment plans and have successfully progressed matters in the courts through the DEU. The Departments of Immigration and Transport Control were also helping the fight said Ms Cox.

She said pensions arrears were on the up and the Department of Social Insurance was continuing to work with the DEU to go after delinquent employers.

Two directors from two different companies have been served court summonses under amended legislation which allows for the prosecution of Directors and Officers of delinquent companies either jointly or severally.

Social Insurance is now setting up an internal debt collection section within the compliance section to be staffed with a full-time debt collector and clerical staff who will target their efforts on highly delinquent accounts as well as providing more timely follow up on 30 to 90 day accounts.

And an aggressive PR campaign will be aimed at making employees aware of their contribution entitlements by checking their contributions online through Social Insurance's more user friendly website.

"This allows the employee to be more accountable regarding their own contribution records and to be able to follow up with their employer on a regular basis for any outstanding contributions," said Ms Cox. "In addition, employers would be made more aware of their social responsibility to keep their contribution payments current."