Local authorities get a bad press these days and the latest example was the news last week that councils had referred 1.8 million debts to bailiffs in the last 12 months.
The figures were gathered using Freedom of Information requests to all 374 local authorities in England and Wales by the Money Advice Trust, a charity formed in 1991 to help people ‘tackle their debts and manage their money wisely’.
The trust said the statistics ‘make clear the massive extent of bailiff use by local authorities’ and went on: ‘We are calling on local authorities to be more responsible in managing their debt collection.’
Most referrals to bailiffs for collection were for council tax arrears, business rate arrears and parking fines.
The trust said the 1.8 million was equivalent to:
- 5,013 bailiff referrals every day
- 334 bailiff referrals every hour
- six bailiff referrals every minute
- one bailiff referral every 10 seconds.
There was a time when town halls were regularly hauled over the coals for the level of arrears they had allowed residents to build up whether for rent, rates or other unpaid bills.
And, of course, one way they’ve cut their costs across the board since the Thatcher era has been to contract out work to the private sector.
So it seems perhaps a little unfair that they are being attacked as irresponsible for turning to the experts in debt collection, bailiffs, for help in recovery.
Especially so, as local authority representative recently cheekily suggested that if HM Revenue & Customs improved their tax collection rates to match those of councils, it could recoup another £20bn at a time of stringent public expenditure cuts – equivalent to £1,370 for every household in the England and Wales.
There’s something about the word ‘bailiff’ that conjures up a whiff of Dickensian conditions.
This is what Joanna Elson OBE, chief executive of the Money Advice Trust, said: ‘These figures make clear that something has to change. It is not economically or socially responsible for local authorities to continue to use bailiffs so frequently. Our experience through National Debtline shows us first-hand how bailiffs can deepen debt problems, rather than solve them.
‘Local authorities seem to be assuming that anyone not paying debts is a “won’t pay”, rather than a “can’t pay”. In today’s economy, with real incomes having fallen consistently for many years, more and more people are falling into the ‘can’t pay’ bracket – sending the bailiffs in to collect these debts can be very destructive, both financially and psychologically.’
But the Local Government Association has supported a protocol devised by Citizens Advice to spread best practice in collection of council tax arrears.
And bailiffs have been changing, even before the government announced its intention to introduce an industry regulator and, as the Ministry of Justice put it in January 2013, ‘provide more protection against aggressive bailiffs and encourage more flexibility in bailiff collections’. [pdf]
Helen Grant, the junior minister for justice, said: ‘Bailiffs are necessary for both the economy and the justice system. They carry out a difficult role in often challenging circumstances, and the majority operate in a responsible and proportionate manner. However, a significant few use intimidating behaviour, treat debtors unfairly and cause unnecessary distress, destroying the reputation of the majority.’
At SJ Collections we strongly believe that: ‘Debt recovery is no longer the heavy handed, leg breaking, business that it was associated with some years ago.
‘We believe in offering a professional service, and are proud and protective of our reputation, and the relationships we have built with our clients.’