New reforms to the enforcement sector will protect the financially vulnerable and give those facing debt greater opportunity to settle at the earliest and cheapest stage possible, the UK Government says.
Setting out plans to overhaul to the way sector operates, the Government today has outlined it will:
- Consult on plans for greater regulation of bailiff firms, including oversight from an independent body accountable to Parliament.
- Encourage earlier and cheaper settlement of debt, reducing the number of “doorstep visits” and avoiding the accumulation of enforcement fees.
- Increase fees bailiff firms can collect for the first time since 2014 to ensure a sustainable sector while better supporting people in debt. The threshold which bailiff firms can charge an additional fee will also be raised to reduce the number of people in debt paying this additional fee.
Minister of State for Courts and Legal Services Minister Sackman, said:
“Debt recovery must be fair to everyone. If you’re an organisation or individual who is owed money you should be able to get it back. And if you fall into debt you should be treated fairly and supported to get back on your feet.
“That is why we are reforming the enforcement sector – to safeguard debtors and creditors alike whilst building a more sustainable system.”
The consultation also seeks views on the role an independent statutory regulator should play in enforcement. This includes how the regulator could work with other regulatory bodies, and how it would be held to account by the Government.
While most bailiff firms have already signed up to the Enforcement Conduct Board’s voluntary accreditation scheme, the government proposals would see all bailiff firms regulated to the same standards and overseen by the same independent body, ensuring greater protections for vulnerable people.
To reduce the number of doorstep visits and help prevent people from falling into more debt through accrued enforcement fees, reforms will increase the minimum notice period which must be given before enforcement officers can visit those in debt to 14 days (from seven) – and to 28 days if requested by a debt advisor.
This will give people more time to access debt advice, and/or set up a payment agreement.
To support a fair, viable, and effective enforcement system, the fees bailiff firms can collect from those facing action will be uplifted by 5%. This is the first fee increase since 2014 and reflects the impact of rising costs on bailiff firms. To protect the interests of financially vulnerable individual, it will be made clear that creditors should not share the profits made from the use of bailiff firms and the charging of fees.
Minister of State for Local Government and English Devolution, Jim McMahon OBE said:
“These reforms will help make sure those facing the enforcement system are properly protected and supported in dealing with their debts – and we won’t just stop here.
“We will shortly be consulting on improvements to council tax administration including the way council tax is collected and enforced, so people can have their say in delivering a fairer system to support both vulnerable households and local councils.”