UKAR ARENA | A NEWSLETTER FOR DEBT ADVISORS | SPRING 2016 | ISSUE 11 | UKAR-ARENA . CO . UK
DAVID HAWKES .
National Money Advice Co-Ordinator , AdviceUK
We know priority debts are becoming more of an issue but rather than looking for more priority debt solutions what we need is better priority creditor behaviour .
All organisations are seeing more clients with more priority debt problems and within that , debts to central and local government are the most prominent . As well as debts to HMRC and magistrates ’ courts fines , Council Tax arrears are the biggest problem .
There are many reasons for this – including the replacement of Council Tax Benefit with Council Tax reduction schemes and the increased financial pressures local authorities are facing – and it is only going to get worse .
So we need to find better ways to engage with local authorities , building relationships to try and achieve best outcomes for clients .
The consumer credit sector has developed significantly in terms of the way it treats people in financial difficulty and has worked closely to achieve better policy and procedures .
But this is not the case with local authorities . They are difficult to negotiate with and much quicker to move to enforcement .
Some organisations are calling for a statutory breathing space or for more measures to help people who are asset-rich and cash poor . So for example , how do you help an elderly couple living in their own home but unable to pay their council tax bill ? Do they sell their home ? Do they apply for equity release ? Both of these are problematic .
Finding ways to work more closely with local authorities makes more sense but it isn ’ t always easy .
Connecting with them collectively is difficult and contacting each authority individually is time-consuming . Regulation would be another way forward , allowing people to negotiate for organisations to accept a reasonable offer .
Whatever happens , improving priority creditor behaviour is a must – and could be a driver for real change .
“ WHAT WE NEED IS BETTER PRIORITY CREDITOR BEHAVIOUR .”
The views in this article are those of the contributor and do not necessarily reflect those of UKAR . 9