Justice Committee to investigate the enforcement of debt by bailiffs
14 December 2018
The Justice Committee launches inquiry into the enforcement of debt by bailiffs (also known as enforcement agents) in England and Wales. The Committee's inquiry will run alongside an MOJ consultation and will focus on High Court and Civil Enforcement Officers, who collect debts such as Council Tax, parking fines and utility bills.
Reforms were introduced in 2014 which aimed to provide protection to debtors from the aggressive pursuit of their debt from enforcement agents, whilst balancing this against the need for effective enforcement and the rights of creditors.
However, debt advice charities suggest that the reforms have had only a limited effect and that there are still widespread problems with the conduct of bailiffs.
The Ministry of Justice (MoJ) is carrying out its own call for evidence into the 2014 enforcement agent reforms. Their call for evidence runs to 17 February 2019. To avoid duplication, the Justice Committee is not calling for written evidence. The Committee will take oral evidence in the New Year, in order to inform the MoJ's future actions.
Terms of Reference
The Committee is seeking to answer the following questions:
- What was the impact of the 2014 enforcement agent reforms introduced by the Tribunals, Courts and Enforcement Act 2007?
- Why has there been an increase in complaints regarding enforcement agents?
- Is the fee structure working to encourage enforcement agents and debtors to settle at an early stage and to minimise the financial impact on debtors?
- Does the current system of self-regulation work as intended, and if not, should enforcement agents be regulated by an independent regulator?
Three types of 'bailiff':
- High Court Enforcement Officers, private sector bailiffs appointed to enforce High Court orders, or County Court orders transferred to the High Court by the creditor. Debt could include: utility bills; business debts; tribunal awards; or rent arrears.
- Civil Enforcement Officers, employed by the magistrates' court to execute a range of warrants including distress warrants, warrants of arrest, commitment of non-payment of fines, and other sums a court has ordered to be paid. This would include, for example: council tax, parking fines, traffic fixed penalty notices, magistrates' court fines; child support payments; and commercial rent arrears.
- County Court Enforcement Officers, employed directly by HMCTS to enforce county court orders and orders made by the tribunals. This would include collection of debts regulated by the Consumer Credit Act (for example, credit cards, personal loans or overdrafts). The Committee's inquiry will not focus on these.
Ministry of Justice Reforms
The Government introduced reforms in 2014, which implemented provisions in the Tribunals, Courts and Enforcement Act 2007. These changes:
- Set out a procedure bailiffs must follow when collecting debt (The Taking Control of Goods Regulations 2013). This included preventing bailiffs from entering properties where only children are at home, further measures to protect vulnerable people and measures to prevent bailiffs from taking vital household essentials from debtors' property, such as a cooker, microwave, refrigerator or washing machines.
- Created a new fee regime with “trigger points” for payment at stages in the process (The Taking Control of Goods (Fees) Regulations 2014); and
- Set requirements for individuals to meet before they are certified to act as bailiffs (The Certification of Enforcement Agents Regulations 2014).
- Created mandatory training to ensure enforcement agents have the skills required to perform the role.
In April 2018, the Government published one year on review of these reforms. The research for this was carried out in 2015, involving the analysis of a variety of data, and gathering of views from key stakeholders including creditors, the advice sector, other government agencies and enforcement agents themselves. The MoJ state:
"[The research] concluded that [the reforms] had led to many positive changes. This included improved transparency and consistency, both in terms of the enforcement process and the fees charged by enforcement agents. The report noted, however, that some enforcement agents were still perceived [by respondents] to be acting aggressively and not complying with the new rules."
Ministry of Justice call for evidence
The Rt Hon Lord Keen QC wrote to the Committee on 26 October 2018 to update on the progress of the Ministry of Justice's plan to launch a call for evidence to examine concerns raised about aggressive enforcement agent activity.
Lord Keen noted that the Government will use the evidence gathered to assess the effectiveness of current regulation and the case for further reform.
On 25 November 2018, the Government published a call for evidence to a Review of the 2014 enforcement agent reforms introduced by the Tribunals, Courts and Enforcement Act 2007.
This seeks evidence on the following topics:
- Treatment of debtors
- Complaints and process
- Training and certification of enforcement agents
- Transparency and consistency of process
- Fees charged
- Commercial Rent Arrears Recovery; and
- Whether further regulation is needed.
This call for evidence runs to 17 February 2019. In a letter introducing the call for evidence to the Committee (23 November 2018), Lucy Frazer QC MP noted that, following analysis of the call for evidence, any prospective policy options will be presented in a public consultation.