Bristol City Council referred more than 2,000 outstanding council tax debts to enforcement agencies in the last six months, the Cable can reveal, despite a promised new ‘ethical’ approach to debt collection.
In 2018, the local authority committed to ending the use of bailiffs to collect unpaid council tax, after a Cable campaign that exposed how the cruel practice pushed vulnerable people further into debt.
The council was lauded for its commitment to a new ‘ethical’ approach, which made it a rare outlier among other local authorities in England.
In 2019, the pilot was launched, which meant phasing out the use of bailiffs, creating an in-house team to provide extra reminders before people get into arrears, and referring them to advice agencies.
In October, the Cable set out to investigate how this new policy was working in practice.
According to the council’s new debt collection policy, which in 2022 was extended to other types of debts such as business rates, if someone repeatedly misses payments and warning notices without showing they are in financial hardship or some other vulnerability, the council may take them to court for a liability order. This could lead to enforcement action being taken.
But crucially, enforcement agents will only be used for people ‘who won’t pay rather than can’t pay.’ The policy says the council will provide people with guidance and support, refer them to other advice agencies, assess what they can afford and any vulnerabilities they might have, and agree an affordable repayment plan – sometimes over years.
The data showed that passing debts onto enforcement agents had all but stopped between 2020 and 2022.
Craig Cheney, Bristol’s cabinet member for finance, told the Cable the initial pilot was “really successful” so far.
“As someone whose parents were often hounded by bailiffs, I’ve tried to avoid using them, because we don’t think it’s the right way to do it,” he said. “We would only use a bailiff in a scenario where somebody who can pay is just refusing to pay.”
“For a vulnerable customer, we continue with arms around the shoulder, referring to advice agencies, working with them to build a comfortable payment plan.”
But new figures acquired by the Cable under freedom of information laws paint a different picture.
The data shows that between 1 April 2023 and 6 November 2023, there were 2,381 council tax accounts referred to Enforcement Agents. In addition,16,968 liability orders were issued over this same time period.
For comparison, in 2019, more than 8,000 debts were passed on to enforcement agents by the council, according to data acquired under freedom of information laws.
Bristol City Council said the reason behind these referrals to enforcement agencies was a build up of arrears during the pandemic. The authority clarified that when debts were referred to enforcement agents, which should be “an absolute last resort”, cases should be sent back where any vulnerability is identified.
Only 93 debts were referred to enforcement agents in the whole previous financial year 2022/23, but this was due to the council slowly restarting its debt collection after it was paused during the pandemic.
Data previously provided by Citizens Advice Bureau (CAB) Bristol showed the number of queries about council tax arrears rose sharply in late 2022, but remained lower than 2019 levels.
LaShauna Stewart, a debt advisor at St Paul’s Advice centre, previously said it was increasingly common that their clients were having issues with council tax debt, including people who had built up debts during the pandemic.
“A lot of these debts have come from Covid, when they stopped taking payments,” she said. “During lockdown, they let a lot of people get behind. They stopped taking deductions from benefits to cover overpayments. It’s crazy. Dealing with the aftermath of Covid is really hard work.
“It’s a sore spot for me that lots of it comes from Covid and the cost of living going up,” she added.
While many are struggling with unpaid council tax, the council recently announced it was scrapping plans to cut £3m next year from its Council Tax Reduction Scheme, which gives thousands of low income households a full discount. This is despite the financial pressures faced by the council, which will have to cut around £20m from next year’s budget in order to balance the books.
This U-turn after a successful campaign by community union ACORN, who stormed a council cabinet meeting in September in protest and queried the “lawfulness” of the council’s consultation on the plans. The Cable previously spoke to one resident in his sixties who said the discount was “fundamental” to his survival and feared losing the crucial support.
On the issue of using debt collection, the Cable asked Bristol City Council how it could explain more than 2,000 people being referred to enforcement agents, if the new ‘ethical’ approach was based on the principle of only using bailiffs when people who can pay but won’t pay.
A council spokesperson said: “During the pandemic, debt recovery action was suspended which led to the build up of a significant number of arrears. This means that the number of cases going through this process in 2023/24 has increased. We anticipate the number of cases moving through the legal process to then reduce back down to pre-pandemic levels.
“For citizens who are experiencing financial vulnerability, we will assist where possible by agreeing an affordable repayment plan. If we are not able to reach mutually agreeable repayment terms, we will refer citizens to the Money and Pension Service or a third sector advice agency for advice and assistance.
“Where cases are ultimately passed to enforcement agents, there are specialist teams available to support citizens who need additional support. Enforcement agents should return cases to the council where vulnerability is identified.
“We remain committed to minimising the number of cases passed to enforcement agents for collection and using their services only as an absolute last resort.”