AN MP claimed last night that his local council had failed to collect £1m in charges for removing business rubbish.

Gerry Steinberg, who is retiring as Durham City's Labour representative, is calling on the watchdog for council finances to look into his claim about Liberal Democrat-controlled Durham City Council.

But the council, a Labour stronghold until the last elections, rejected his claim - although it admitted a minor problem with a new financial management computer system after bills for the last financial year were sent out in April last year.

The MP said he had been told no bills had been issued for trade waste collection since November and was asking the council to say when it discovered there was a problem with its financial management systems and what steps it took to rectify them.

"Certainly, I feel that council taxpayers have every right to know the financial implications of the council's failure to issue bills," he said.

"It is also essential to establish how the authority has managed to operate without collecting these charges, and whether it has needed to make up the shortfall in income or has lost interest on assets as a result of this failure.''

Mr Steinberg said the council had so far not issued a statement on the situation despite its stated policy of being transparent and open .

"I have therefore also asked for details of the district auditor's view on this state of affairs," he said.

A council spokesman said a minor problem in the financial management system was discovered and the council cabinet decided in November to hire specialist consultants to solve it.

"The difficulties with a system of this size and complexities are not uncommon and have been experienced by other partners in the region.

"The budgeted income for the whole of the trade refuse service for that year is £600,000.''

He added that the district auditor was aware of the problem but stressed that there was no shortfall in income to make up.