Council calls for debt collection reform

Harrow Council have suggested that they may implement a new policy for their debt collectors to abide by in a bid to lessen the burden on people who are in debt.
The council released a statement that identified that many people in their area were currently undergoing ëunprecedented hardshipí due to their debt problems, and warned that the burden of trying to improve their finances has caused many to contemplate suicide.
In the last two years, councils across the UK have been working together to try and create a new ëvulnerable criteriaí for debt collectors to follow that will entail them making a judgement about the mental state of a debtor in order to determine the course of action they take.
Debt collectors will also have to judge whether they believe a debtor genuinely cannot pay their debt or whether they are lying, and will act accordingly.
Proposals for the new criteria begun back in 2012, after a council report argued that reductions in welfare distribution from the government would have severely damaging effects on working class individuals ability to pay their council tax.
Pamela Fitzpatrick, director at Harrow Law Centre said: 
ìThe proposed policy is well intentioned. However, we are not convinced that the council is taking sufficient steps to protect the most vulnerable.
ìThe increased council tax for vulnerable people comes at the same time as significant cuts to welfare benefits, which are impacting in particular on people who have serious illness or disability.
ìAs a result we are witnessing unprecedented hardship in Harrow.
ìSadly, we regularly see clients who are forced to make the harsh choice between paying essential bills, such as their council tax, or eating.
ìA number of our clients have told us that their health has deteriorated and some have even reported feeling suicidal.î
The final decision on whether the new criteria will be passed is yet to be made, and a cabinet committee is set to convene and vote on the matter next month. 
As well as the introduction of the vulnerable criteria, a number of other proposals are set to be voted on as well which will always focus on the debt recovery process.
Other suggestions include wider distribution of debt advice by the Council and a new check in the conduct of debt recovery officials. 
The report read: ìIn this way we would hope that the devastating impact of bankruptcy is only applied to those of our residents who wonít pay rather than to those who canít pay.
ìWhilst we have no issue with the processes being applied to those of our residents who are refusing to pay, we hope that the mitigations we proposed in our review can safeguard the more vulnerable of our residents who are unable to pay these new bills.î
If enacted, the new criteria would still require people to pay their council tax off eventually, but would compensate people for this through the provision of food vouchers, clothing and fuel payments. 
Tony Ferrari, cabinet member for finance at Harrow Council, said: 
“This policy looks very carefully at vulnerable people in Harrow, and recognises that some of them experience difficulties when they owe a financial debt to the council. These criteria will allow us to look at each case individually and consider various options to assist vulnerable residents, depending on their specific circumstances.
“This does not mean debt will simply be excused, but rather allows us the flexibility to be fair and supportive to vulnerable residents when recouping their debt.”


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