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Local councils sent 2.6 million debts to bailiffs in 2018/19

  • Money Advice Trust research explores councils’ bailiff use in England and Wales

  • 7% rise in bailiff use over 2 years driven by parking debt referrals, now at 1.1million

  • Bailiff use for council tax arrears levels off, but remains high at 1.4million referrals

The use of bailiffs to collect debts owed to local authorities in England and Wales has risen by 7 percent in two years, driven by a surge in the use of bailiffs to collect parking debts, according to new  research by the Money Advice Trust, the charity that runs National Debtline and Business Debtline.

More than 2.6 million debts were passed to bailiffs by local authorities in 2018/19 according to the research, based on Freedom of Information requests. Bailiffs, now known officially as enforcement agents, have the right to visit a property to remove and sell goods to repay certain debts, including council tax arrears, parking notices and other debts owed to councils.

While the number of referrals to bailiffs for council tax debt remained stable from two years earlier, the Money Advice Trust says the overall number of 1.4 million remains too high and around half of councils are continuing to increase their use of bailiffs for council tax.  However, 51 percent used fewer bailiffs than two years ago – and the charity has found a modest net improvement in debt collection practices in that time.
Three in 10 callers to National Debtline (30 percent) last year had council tax arrears – up from just 15 percent in 2008.  Many of these callers are subject to bailiff action, with 83% of National Debtline callers who have experienced bailiff action surveyed reporting a negative impact on their wellbeing.

Increase driven by surge in bailiff use for parking
The charity’s new report, Stop The Knock 2019, found a further overall increase in local authority bailiff use, driven by a surge in bailiff referrals for parking debts.
  • Local authorities in England and Wales passed 2.6 million debts to bailiffs during 2018/19, with a 7% like-for-like overall increase on 2016/17
  • Parking debts were passed to bailiffs on nearly 1.1 million occasions – a 21% like-for-like increase on the same period in 2016/17
  • The number of council tax debts passed to bailiffs remained stable for the first time – compared to a 10% surge in the preceding two year period – but remains high at more than 1.4 million referrals in 2018/19.
Modest improvement in practices
The research finds that councils have made some limited progress on improving debt collection practices over the last two years, with the efforts of individual councils and campaigning from the debt advice sector beginning to have an impact.
 
  • The proportion of councils who have reduced their bailiff use over the last two years stands at 51 percent – up from 38 percent two years ago
  • The research found a modest net improvement in debt collection practices, with more councils adopting best practice on affordability and vulnerability 
  • 64 councils have now signed up to the Citizens Advice/LGA Council Tax Protocol – up from 50 two years ago.  A further 23 are considering doing this.
Calls for local and national policy changes
The charity says the pace of improvement across the country is too slow, and is calling for policy change at a local and national level.  The Money Advice Trust has written to Council Leaders and the Minister for Local Government to recommend: 
  • All councils should adopt the Money Advice Trust’s ‘six steps’ to improve, as already used by several councils and endorsed by the Welsh Government
  • Government should review and amend council tax regulations, place existing Good Practice Guidance on a statutory footing, and introduce and fully fund a requirement for councils to provide 100% Council Tax Support schemes
  • Government should review the enforcement of Parking Penalty Charge Notices and bring this into line with CCJs – allowing the court to suspend warrants and people to apply to pay through affordable installments
In addition to measures to reduce the use of bailiffs in the first place, the Money Advice Trust has renewed its call– made as part of the Taking Control group of debt advice charities – for the government to introduce independent bailiff regulation and an accompanying complaints mechanism.  Calls for independent regulation were recently supportedby the Justice Select Committee.

The Ministry of Justice is currently reviewing the case for independent bailiff regulation, while the Ministry of Housing, Communities and Local Government is conducting a review of council tax collection.

Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs National Debtline, said:

“Bailiff action is harmful to people in debt – and the fact that local authorities are passing 2.6 million debts a year to bailiffs should concern us all.

“Reforming the law around bailiff action itself is vital if we are to protect people from harm – and we are today renewing our call for the government to introduce independent bailiff regulation and a single complaints mechanism.

“Of equal importance, however, is reducing the number of debts that are being passed to bailiffs in the first place.  While we have seen a modest improvement in debt collection practices – and more councils reducing their use of bailiffs to collect council tax arrears – the pace of change is too slow.

“Bailiff action should only ever be used as a last resort, and can be avoided by early intervention, making sure residents get the free debt advice they need, and agreeing repayment arrangements that are affordable and sustainable.

“We will continue to work constructively with councils to help them reduce their bailiff use – and to impress on central government the urgent need for the national policy changes that are required to quicken the pace of change.”

The Money Advice Trust has today published the results of its research on an online map at www.stoptheknock.org. The interactive map allows local councillors, residents and other interested parties to view each local council’s debt collection practices, and the charity’s six steps for local authorities to take to improve their practices:

 

1. Make a clear public commitment to reduce bailiff use over time
2. Review signposting to free debt advice, including phone/online channels
3. Adopt the Standard Financial Statement to objectively assess affordability
4. Put in place a formal policy covering residents in vulnerable circumstances
5. Exempt Council Tax Support recipients from bailiff action (in England*)
6. Sign up to the Citizens Advice/LGA Council Tax Protocol (in England*) and review current practice against the Money and Pensions Service ‘Supportive Council Tax Recovery’ toolkitSign up to the Citizens Advice/LGA Council Tax Protocol (in England*) and review current practice against the Money and Pensions Service ‘Supportive Council Tax Recovery’ toolkit

 
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