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Our response to the Ministry of Justice’s Call for Evidence on bailiff reform

The use of bailiffs to collect debts has been increasing over the last few years. In 2017 local authorities used bailiffs more than 2.3million times.

Many of these debts are enforced against people who simply can’t afford to pay. The use of private bailiffs to collect their debts is particularly intimidating, while the addition of bailiff fees escalates debt problems. However, we do not see the level of control on bailiffs and bailiff firms that is now commonplace in other industries, such as the financial service sector.

The Ministry of Justice launched its most recent Call for Evidence to end bad practice in the industry for good, when advice sector evidence showed 2014 bailiff regulatory reforms were not working as intended.

The Taking Control campaign brought together a group of 11 organisations to respond to the Call for Evidence. All have continuing concerns about the treatment of people in debt by the bailiff industry. The fact that so many different organisations are continuing to report poor practice by bailiffs, is unlikely to be a coincidence, and points to a systemic problem across the bailiff industry, resulting from insufficient regulation.

Our response shows:

Poor bailiff behaviour continues in 2019

  • More than 1 in 3 (39%) people contacted by bailiffs in the last two years – around 850,000 people in England & Wales – have seen a bailiff breaking regulations or national standards.
  • Local Citizens Advice offices saw a 24% increase in bailiff issues reported between 2014/15 and 2017/18.

Bailiffs are mistreating vulnerable people

  • In 2017/8, Citizens Advice saw over 5,600 clients with issues related to the treatment of vulnerable people by bailiffs, a 42% increase from 2014/15.
  • At a national level of people contacted by bailiffs in the last two years, 18% had witnessed bailiffs treating someone with an illness or disability unsympathetically.

It is difficult to complain about bailiffs

There are no effective penalties for firms whose agents break the rules. While individual agents can have their certification revoked, the firms who employ them face no specific consequences. This is in stark contrast to financial services, where not only can the Financial Ombudsman Service provide financial compensation, but the regulator can fine firms for rule breaches.

  • Our national polling found 3 in 4 people who experienced bailiffs breaking rules didn’t complain.
  • In the 4 years since the 2014 regulations there have been only 56 complaints to court about a bailiff’s fitness to hold a certificate.

Bailiff fee structures escalate debt

The bailiff fee structure results in disproportionate level of fees being added to small debts that escalate financial difficulties; above-target profit margins for bailiff firms, subsidised through the fees paid by people in debt; and escalation to the enforcement stage rather than encouraging early settlement. In 2019, 29% of those answering a StepChange website survey had tried to arrange repayments by phone, but the bailiff insisted on visiting their home to take payments.

We need an independent regulator of the bailiff industry

The 2014 regulations haven’t cleaned up the industry, as there are no sanctions nor incentives to comply. The Ministry of Justice must introduce an independent regulator which can ensure that bailiff firms and individual bailiffs stick to the rules which govern their behaviour and treat people in debt fairly. In conjunction, the Ministry of Justice should introduce an independent complaints mechanism to ensure people can get redress when bailiffs break the rules.

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Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

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© StepChange Debt Charity 2019