National Debtline urges council to reduce bailiff use for council tax and other debts

National Debtline has written to Thanet council urging the authority to improve the way it collects council tax arrears and other debts.

The letter comes on the heels of new data from National Debtline and the Centre for Social Justice showing Thanet council referred 12,886 debts to bailiffs in 2022/23.

National Debtline, a free debt advice service run by charity Money Advice Trust, says although this figure is a -6% decrease on pre-pandemic levels in 2018/19, bailiff use remains too high and action is  #needed to improve collection practices so fewer debts are sent to bailiffs in the first place.

But Thanet council says although the figure is correct, it is not representative of most years. Of the 12,886 debts, 10,165 (79%) related to unpaid Council Tax bills.

During 2022/23 the council referred 6,311 historic arrears cases to enforcement agents. These were cases where bailiffs had attempted to recover debt but were unsuccessful and dated back several years.

By comparison, 5,886 cases of unpaid Council Tax were referred to enforcement agents for the financial year 2023/24, which Thanet council says also included historic cases but is more representative of the usual picture.

Debts referred to bailiffs

The figures, revealed in response to a Freedom of Information request, have prompted the charity to ask Thanet council to adopt its ‘six steps’ to improve collection practices. This includes exempting residents who are receiving local Council Tax Support from any form of bailiff action.

The charity findings show that across England and Wales, 2.71 million debts were referred to bailiffs by councils during 2022/23 – broadly unchanged on pre-pandemic levels (2.65 million in 2018/19) and 1.3 million households fell behind on their council tax bill in that period.

Bailiffs, known officially as enforcement agents, have the right to visit a property and can remove goods to be sold to repay certain debts, including council tax arrears, parking penalty charge notices and other debts.

National Debtline is calling for national changes from the Government to help reduce and reform bailiff action, including through new ring-fenced funding for councils to provide 100% Council Tax Support schemes for those on the lowest incomes.

Call for government support

Steve Vaid, chief executive of the Money Advice Trust, the charity that runs National Debtline, said: “Local authorities remain under significant financial pressure and council tax plays a crucial role in funding vital local services.

“Facing bailiff action, however, can be a distressing experience and risks pushing people already struggling into deeper financial difficulty. Bailiffs should only ever be used as a last resort.

“The fact Thanet council has decreased its use of bailiffs to collect debts is welcome, but there is still more to be done to improve debt collection practices for the benefit of both people in difficulty and councils.  We have written to the Leader to set out simple steps they can take to improve the way the council collects debts it is owed.

“We are also calling on the new government to support Thanet District Council and other councils by introducing ring-fenced funding to enable all local authorities to provide 100 percent Council Tax Support to households on the lowest incomes.

“I would urge anyone in Thanet struggling with their finances to get in touch with National Debtline as soon as possible. Our expert advisers provide free, impartial support and can help residents make a plan whatever their circumstances.”

‘Last resort’

Thanet council does have support available for those struggling to pay council tax bills and says the use of bailiffs is the “last resort.”

A council spokesperson said: “If a resident fails to make a Council Tax payment, we issue a series of reminders and offer a number of ways to make payments, including by instalments. The option to pay in instalments remains available through to the end of the financial year, thereby avoiding further costs to the debtor, even after the final notice for payment has been issued.

“Some unpaid debts will be referred to enforcement agents but it should be stressed that this is always a last resort. Attempting further enforcement activity on historic cases maximises the chance of recovery and reduces the likelihood of writing off debt that the taxpayer ultimately has to fund.

“While recent increases in the cost of living have put greater pressure on household finances, Council Tax is a really important source of income for the council and it’s important that people pay if they can so that we can provide essential services for local residents.

“Where people are struggling to pay, we offer different kinds of support. Thanet has the most generous Council Tax support scheme in Kent covering up to 90% of Council Tax for qualifying working age residents, reducing the impact of Council Tax demands on vulnerable people living in the area.

“We encourage people who are finding it difficult to make payments to talk to us so that alternative payment arrangements can be made. We will always work with residents to find a solution.

“We also offer residents advice on managing household finances.”

National Debtline’s six steps are:

• Make a clear public commitment to reduce the council’s use of bailiffs over time
• Exempt Council Tax Support recipients from bailiff action
• Put in place a formal policy covering residents in vulnerable circumstances
• Take steps to understand household circumstances before a liability order is sought
• Adopt the Standard Financial Statement (SFS) to objectively assess affordability
• Review councils’ signposting to free debt advice, including phone/online channels

Get advice

Information on where to seek debt advice, advice on benefits, and general cost of living support can be found on Thanet council’s website.

National Debtline offers free, independent debt advice on 0808 808 4000 or at www.nationaldebtline.org