Six policies the Government should adopt to best support those in problem debt pt.1
By Sophie Morris, Public Affairs Advisor
It’s been a difficult few years for household finances. Rising living costs, the pandemic and a housing emergency have resulted in over one in four UK adults struggling to cope financially. With a new government and Parliament in place, StepChange’s public affairs and policy team have been working hard to ensure financial security is at the heart of the new legislative agenda.
We have six top policy asks for the Government for this parliamentary session to best tackle problem debt. We’ll be examining the first three today and the final three tomorrow:
1. Modernise council tax debt collection
One in three StepChange clients responsible for paying council tax is in arrears — that’s over 40,000 people. Under current rules, missing just one council tax payment could result in being confronted with a bill for the rest of the year, along with threats of imprisonment and the very tangible possibility that bailiffs will visit your home. All this at a time when people are struggling to keep their heads above water due to once-in-a-generation cost pressures.
We’re calling on the new government to reform the current outdated council tax collection approach and improve outcomes for those who struggle to pay this bill, by introducing statutory standards and a pre-action protocol so that councils take reasonable steps to engage and support people struggling with council tax before escalating collection to court and potential bailiff enforcement. Our new report Looking through the Keyhole explores StepChange clients’ experiences of the council tax debt collection journey and what central government and local authorities can feasibly do to ensure for good debt collection practice which benefits individuals and boosts collection rates among those who can afford to repay.
2. Introduce a statutory regulator for bailiffs
Four million people in the UK face bailiff action every year, yet too often bailiff conduct falls short, with evidence of poor and intimidating practices that cause harm — particularly to those that are vulnerable. It’s therefore no surprise that three in four people say bailiff conduct has negatively affected their mental health, which can compound existing struggles and make it more difficult to resolve debt.
Our public affairs team are continuing engagement efforts with the Cabinet to introduce a statutory regulator for bailiffs to ensure a boost in standards of practices and to protect vulnerable people from harm as a top priority.
3. Establish a Tenancy Support Duty
With record rises in rent costs this year, the financial situation for private renters is becoming increasingly precarious with one in two private renters finding it difficult to keep up with bills and credit commitments.
To protect renters from eviction when people fall on hard times, we’re advocating for the establishment of a Tenancy Support Duty as an amendment to the new Renters’ (Rights) Bill as it progresses through the Commons. This would require landlords to signpost tenants in arrears to free advice, provide time to access support and benefits, and make reasonable attempts to agree an affordable repayment plan, reflecting practice in the social rent and mortgage sectors to help sustain tenancies.
Look out for part two of our top six policy priorities tomorrow!
