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.
Setting out plans to overhaul to the way sector operates, the
Government today (Monday 9 June) 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 launched today 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, 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.”
ENDS
Notes to editors
- The Enforcement Conduct Board (ECB) was established in 2022,
tasked with providing voluntary, independent oversight of the
sector to ensure fair treatment for every party facing
enforcement action.
- The Government is consulting on how to ensure that there is
independent oversight of firms that employ enforcement agents and
High Court Enforcement Officers to enforce debts using the Taking
Control of Goods procedure in England and Wales. The consultation
will run for six weeks. Responses will inform legislation to be
brought forward as soon as parliamentary time allows.
- As set out in the Chancellor of the Exchequer's Regulation
Action Plan, when regulation is designed well it can be an
essential tool to promote growth and investment and protect the
public. We will introduce independent statutory regulation of the
sector in line with the objectives in the Action Plan, and our
work across Government to cut the administrative costs of
regulation by 25% by the end of parliament.
- The threshold above which bailiff firms can charge an
additional percentage fee will be raised by 24%. Currently, an
additional one-off fee of 7.5% of any debt over a set threshold
can be recovered by bailiff firms if the debt reaches the
enforcement (visit) stage. The 24% rise to this threshold will
rebalance these fees in line with inflation and reduce the number
of people in debt paying the additional fee.
- The reforms to the regulations about when fees can be
recovered and uplifts to the fees and thresholds will be
implemented when parliamentary time allows.
