Last month, the Money Advice Trust’s annual ‘Stop the Knock’ report was released, detailing the latest stats about debt collection in the UK. As ever, headlines have centred on more attention-grabbing statistics, like the fact that use of enforcement agents by lower-tier local authorities increased by 14% since 2014/15. What interested me more, though, was that the tone and focus appears to have shifted a little.
The polemic problem
The appearance of these reports is always a concern for me – not especially because of the stats they contain, but because of the viewpoint they sometimes contain. These kind of documents represent a blanket policy designed to reduce the use of enforcement agencies, full stop.
If this approach were to succeed, it would mean more debt being ignored, less money recovered for companies and councils and long-term financial problems that will need to be addressed in the future. In short: enforcement agents aren’t the enemy, they are an essential last resort for organisations to deal with repeat non-payers. This is something these charities must acknowledge.
Fortunately, this year, the tone of the report seemed a little different to me. Alongside the numbers were also acknowledgements of the worsening debt problem faced by local authorities and suggestions for greater collaboration between agencies. These suggest a growing awareness of the bigger picture and a willingness to accept it.
I think that this development is, at least in part, a reluctant recognition of those of us in our sector's efforts to show the industry isn’t as ruthless as it’s commonly portrayed. As well as our efforts at Dukes to ensure fairness for people facing recovery action, companies like TrueAccord in the US are investing heavily in more ethical debt collection. Of course, our own industry body CIVEA is also working hard at establishing a strong conversation.
Our experience is that by reaching out and giving people in debt the respect they deserve, the whole dynamic changes. With time, leeway and a voice, they have a new perspective on the outcomes that we're trying to achieve – recovery for local authorities – and are much more willing to engage. We’re hoping that the same approach can work with debt charities.
The truth is that the third sector should be open to dialogue, rather than simply criticising attempts to reclaim sums due. If, as this latest report suggests, some of them are recognising this, it could herald great improvements. But we’re still at the first step and it will take focus, openness and a willingness to compromise if we are to move forward.
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