The Ministry of Justice has announced that it will allow enforcement visits to recommence from 24th August 2020.
Responding to the announcement, debt charity StepChange says that it believes this is unsafe, and deeply troubling when compared with the more careful approaches being taken in other sectors where regulators are closely overseeing the practices of firms.
StepChange says it is too soon to be enforcing against debts owed to the government, especially given the fact that the Financial Conduct Authority has extended protection to the end of October for debts such as mortgages and consumer credit. Far too many households will still be vulnerable at this point, and a more considered plan to help them recover their finances without rushing to premature enforcement is needed.
Under the Taking Control of Goods and Certification of Enforcement Agents (Amendment) (No. 2) (Coronavirus) Regulations 2020, the 24th August has been confirmed as the date from which bailiffs can recommence visits to people’s homes.
The date coincides with the previously-announced end date for the protection for tenants from eviction for rent arrears during the coronavirus crisis. With 590,000 people behind on rent, tenants are another group at serious risk of eviction without consideration of ability to pay is allowed to happen.
Stepchange says that the lack of protection over bailiff enforcement – where firms still remain unregulated and continue to operate under an inadequate self-regulatory code – contrasts starkly with the approach being taken to FCA-regulated mortgages and consumer credit, and to the recently announced expectations in the energy sector.
Peter Tutton, StepChange Head of Policy, said “We already know that households have built up over £6 billion of debt as a result of the coronavirus crisis, and that exiting this situation is going to require care and careful planning if we are to avoid serious financial hardship for millions of people. By the end of August, many households will still be facing great financial uncertainty.”
“It’s shocking that the government prioritised reintroducing bailiff enforcement for debts like council tax over helping households reeling from the financial shock of lockdown. Government should be showing the way on enlightened debt practices but instead has fallen further behind the harm prevention approaches required of private sector lenders. We are still waiting for the improvements in council tax collection and bailiff regulation promised last year. What people in hardship need is help, not draconian enforcement.”
“The suspension on rent evictions is due to end at the same time. a potential double jeopardy for people also struggling to pay rent. While the Government and FCA recently announced a welcome extension mortgage payment holidays and protection from repossession until the end of October, this does not seem to be being matched by joined-up thinking on the approach to tenants and to debts such as council tax.”
Responding to the Ministry of Justice announcement, Russell Hamblin-Boone, Chief Executive of the Civil Enforcement Association, said “This is an appropriate response to achieve the balance the government must strike between collecting debts in the name of fairness for the taxpayer, while recognising the vulnerability of some of individuals and families affected financially, socially and healthwise by the COVID-19 pandemic. Enforcement firms have already made a commitment to act sympathetically and in line with the government’s public health guidelines, which will be clearly communicated ahead of an enforcement visit.”
This will not be business as usual. We will be implementing a detailed Post-lockdown Support Plan and all agents have received training on the new operating procedures. This is a unique initiative and we are pleased to be leading the way in responsible enforcement.”