Written evidence submitted by the Civil Enforcement Association [SRF 022]
CIVEA is the principal trade association for civil enforcement agencies in England and Wales. It comprises 38 companies, together employing 2,000 certificated enforcement agents, and represents over 95% of the entire enforcement industry.
CIVEA’s members work to enforce civil debt on behalf of local authorities, central government, Transport for London, Highways England and Her Majesty’s Courts and Tribunals Service (HMCTS). This includes council tax, business rates, parking and traffic penalties, magistrates’ court fines and compensation, employment tribunal awards, child support payments, B2B and commercial rent arrears. More than £550m is collected annually at no cost to the public purse. Around 60% of council budgets are allocated to supporting vulnerable households.
The main purpose of the enforcement profession is to ensure that:
• local authority, taxes and business debts are collected
• private citizens have a mechanism to enforce their rights against individuals or institutions
Our members are dedicated to providing a fair and responsible service that recovers much needed funding for local authorities to deliver vital frontline services, which support the most vulnerable. While ensuring those in need of financial advice or additional support are protected, local authorities have a civil duty to recover outstanding public debt from those who can afford to pay and choose not to.
The civil enforcement profession therefore has an important role in society and the economy and underpins the legal and credit system.
Enforcement action is necessary when a debtor fails to pay a debt or negotiate a reasonable instalment payment with their creditor.
CIVEA welcomes public dialogue on sources of local government funding as this is a vital, and often overlooked, topic. In this short submission, CIVEA has addressed two areas where the Committee has invited evidence and a third section of additional information.
Among other prominent bodies, the Local Government Association (LGA) has warned authorities are facing a £7.4bn shortfall in funding this year, due in large part to the impact of COVID-19 on council revenue.
Labour MP, Mick Whitley recently noted that “the County Councils Network warned that 60% of its members anticipate having to make a fundamental reduction in frontline services, while just one fifth are confident that they can set a balanced budget next year. At a time of spiraling unemployment and a public health crisis unlike any known in our lifetime, we simply cannot afford further cuts to already overstretched and underfunded frontline services.”
Local councils cannot afford to have their hands tied regarding debts owed by those who willfully refuse to pay.
We have maintained the position that civil enforcement is – and should always be – the final stage when all other attempts to recover money owed to local councils have been exhausted. However, reflecting the financial circumstances, it remains a vital resource to recover important revenue to support public services, such as Adult Social Care, and ensure fairness to other taxpayers. There is strong support from the public support for civil enforcement in this role (see appendix).
There are several key points to note regarding role and processes of CIVEA members:
During the pandemic, there was a voluntary suspension civil enforcement visits by CIVEA members, which was later mandated in legislation for all other enforcement. It began at the end of March and ran until the end of August. In this time, councils incurred £4.8bn of extra costs and income losses.
Failure to address these significant budget shortfalls, despite extra central Government funding, would unquestionably impact members of the community who need support from local authority services, at a time when the services are most needed.
Amid this mounting pressure on local authority finances, CIVEA developed the Post-lockdown Support Plan, which has led to the successful resumption of enforcement and secured vital funding for local services. However, the self-imposed limitations has meant that collections rates are down by between 70 and 90 percent, depending on the debt type.
The Post-lockdown Support Plan was developed in conjunction with the Ministry of Justice and debt charities. The civil enforcement industry and CIVEA specifically have been praised by the Lord Chancellor for our approach.
The vast majority of visits since enforcement activity resumed post-lockdown, have been to enforce fines, traffic offences and other penalties that have been outstanding since before lockdown measures led to a suspension of activity. Most people have continued to meet their repayment plans throughout the coronavirus pandemic, indicating that payments are both fair and affordable. CIVEA members will only visit debtors who have not engaged or communicated with their local authority despite being given numerous opportunities to do so. Visits are only authorised when there is a genuine need and previous attempts to resolve debts by other forms of communication have failed.
Since the resumption of enforcement visits in August to collect overdue, pre-coronavirus debt owed to local authorities, CIVEA has reported regularly and positively on its progress to the Ministry of Justice.
Key findings from our reports to the Ministry of Justice include:
Inconsistent national policy
A specific concern identified by CIVEA members, which will impact on the public purse, is the inconsistency in policy between England and Wales. The Welsh Government has placed tighter restrictions on enforcement agents. Unlike in England, enforcement agents are prohibited from visiting residential premises, even under contactless, social distancing rules.
Council collection and fee income in Wales dropped dramatically. One CIVEA member reported that it was like turning off a tap as payments instantly dried up. Fee income is down 61% and falling. Recovery by telephone, SME, etc has limited effect without physical enforcement visits to negotiate repayment or identify people in severely vulnerable circumstances. This will have a major impact on local authority revenue in Wales.
The decision is especially frustrating because in advance of the Welsh Government decision, enforcement firms in Wales had voluntarily agreed not to clamp vehicles or attempt to take control of goods during lockdown periods.
The table below shows how Welsh councils responded positively to the proposed arrangement before the Welsh Government overrode the proposals. These are verbatim comments to the proposal that indicate that local authorities were entirely confident about the voluntary procedures that were put in place to ensure the safety of agents and the public.
WELSH LOCAL AUTHORITY
Bridgend County Council
“That makes perfect sense – thank you.”
Cardiff City Council
Carmarthenshire County Council
“We acknowledge your position and think it is a sensible way forward at this difficult time.”
Carmarthenshire C C Revenues
A proportioned and sensible decision
Carmarthenshire C C Parking Services
Fine with us, thanks.
Ceredigion County Council
“Thank you for the update”
Neath Port Talbot County Borough Council
“We are happy for work to continue with the safe precautions you have implemented”
Newport Parking Services
“No problem, that all seems very sensible”
Rhondda Cynon Taff County Borough Council Revenues
“Thanks for the update Andrew - I assumed this would be the case and that is good to hear.”
Rhondda Cynon Taff County Borough Council Parking Services
“The restriction on wheel-clamping that you have voluntarily agreed with competitor firms is entirely reasonable and we are happy for you to continue to work during the Wales lockdown on that basis.”
Swansea City Council
“Many thanks for the update. I welcome your approach”.
City and County of Swansea Parking Services
“Your proposed operations seem reasonable during the coming lockdown restrictions and thank you for liaising with the other enforcement agents.”
City and County of Swansea Revenues
We knew you’d take a sensible approach.
Wrexham County Council
“Thanks for below, fine with the approach”
By ignoring the agreements made at a local level with a blanket national policy, the Welsh Government created a budget shortfall that was entirely unnecessary.
In contrast English authorities have allowed some enforcement to continue in line with CIVEA guidelines and Public Health England guidelines. It is testament to the industry that over 70 percent of local councils in England have instructed enforcement firms to recommence visits to recover council tax and court fines that were unpaid before the lockdown.
Public recognition of the role of civil enforcement
There is widespread public support for civil enforcement, recognising it remains a vital tool for local authorities to recover important revenue to support public services and ensure fairness:
CIVEA also recognises that alongside the need to protect council finances there may be increased levels of financial vulnerability due to COVID-19 and has consistently taken proactive steps to support those in problem debt:
 HC Deb, 24 November 2020, c339WH
 CIVEA Post-lockdown Support Plan Frequently Asked Questions | CIVEA
 Correspondence between Lord Chancellor and CIVEA, 5th November
 Total sample size was 1,606 adults. Fieldwork was undertaken by YouGov between 4th - 5th August 2020. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+). Full data is available on request.