Brighton and Hove City Council is owed more than £3.7 million in uncollected rent.

An independent watchdog issued the authority with a one-star rating after finding the council's management of its housing income was weak and progress to improve it was slow.

In 2003-04 former tenants left council properties owing £1,348,463 and the council managed to claw back only £79,810, writing off £503,344.

In the last financial year, from April 2004 to April 2005, former tenants owed £1,411,277.

The council collected £151,538 of that but wrote off £200,546. A total of £703,890 in uncollected rent from former tenants was written off over a two-year period.

The report from the Audit Commission said the council has carried out little proactive work to collect former tenant arrears and the historic debt remains high.

"The council is not working consistently to prevent rent arrears or catch cases at an early stage.

"We reviewed a number of files and found some cases where there had not been any action taken to recover rent arrears for several weeks.

"In some cases the debts were reaching nearly £1,000 before the recovery process was started."

The 44-page report highlighted the state of disrepair of homes and the huge amount of cash needed to bring the city's 13,000 council-owned properties up to the Government's decent homes standard by 2010.

Only 51 per cent of the city's housing meets the decent homes standard.

The report said the council would need £119 million to meet the standard by 2010, an additional £50 million for other essential works such as dealing with asbestos and a further £26 million to make adaptations and environmental improvements to estates.

The council has a budget of £15 million leaving it with an estimated shortfall of approximately £120 million between the money it needs to carry out the work and the money which is likely to be available. The report said the council was also failing to fulfil its legal responsibilities for gas servicing, play areas on estates were not regularly inspected and maintained and in some cases presented health and safety risks.

The council's performance with gas servicing was poor with 95 per cent of properties due for a service and 417 without an up-todate gas safety certificate.

Garry Peltzer Dunn, leader of the council's Tory group, said:

"The frightening thing is they are saying within a few years 90 per cent of the housing stock will be sub standard.

"That is a terrible indictment of us as an authority."

Coun Bill Randall, the Green Party spokesman on the city's housing committee, added: "The reason for this is a lack of political will on the part of the Labour administration. There's been no pressure put on the housing management service to improve."

The report said improvements were being made, drives for change including a new estate management service and a centralised debt recovery team.

Labour councillor Don Turner, chairman of the housing committee, said: "The £3.7 million owed to the council by tenants is just 1.4 per cent of the total cost of running the housing service. Straight after the report was published in June the council set up a new debt collection team to help bring this figure down even further."