Government outlines measures for debt enforcement

The Government has unveiled a comprehensive strategy aimed at overhauling the existing debt enforcement framework, with an emphasis on safeguarding vulnerable debtors while maintaining a fair system for creditors. Minister Sarah Sackman KC emphasised the importance of fairness, stating that “debt recovery must be fair to everyone," asserting that both debtors and creditors deserve to be treated justly. The three-pronged package focuses on introducing independent regulation, reducing unnecessary bailiff visits, and increasing allowable fees for bailiff firms.

Consultations will soon commence to garner input on the governance of bailiff firms, with proposals stating that oversight should come from an independent body directly accountable to Parliament. Among the plans is a significant reduction in the frequency of doorstep visits, which enables bailiffs to prevent the unfair accumulation of enforcement fees on debtors. This ensures that people facing financial challenges have better opportunities to settle their debts at earlier and more economical stages.

Moreover, the Government intends to raise the fees recoverable by bailiffs for the first time since 2014, establishing a balanced approach that reflects rising operational costs while protecting the financially vulnerable. Notably, the threshold for additional fees charged by bailiffs will see a 24% increase, meaning fewer individuals will be burdened with extra costs as their debts progress through enforcement stages.

To facilitate a smoother debt resolution process, the notice period before enforcement agents visit debtors will be extended from seven to fourteen days, and from fourteen to twenty-eight days if requested by a debt advisor. This measure is designed to provide individuals more time to seek assistance and explore payment agreements.

Local Government and English Devolution Minister Jim McMahon OBE also highlighted the broader agenda for reform, asserting, “These reforms will help make sure those facing the enforcement system are properly protected and supported in dealing with their debts.” He indicated that this is just the beginning, with upcoming consultations regarding council tax administration set to further support vulnerable households against potential financial strain.

The consultation process about the regulation of enforcement agents is expected to last six weeks, culminating in legislation that aims to bolster protections for those facing debt enforcement action. Established in 2022, the Enforcement Conduct Board's role will be pivotal in ensuring that all bailiff firms adhere to a consistent regulatory standard, further reinforcing the project to ensure fair treatment for all involved in enforcement actions.