Bailiffs: Regulatory Reform

Emma Reynolds Excerpts

Wednesday 9th January 2019 Westminster Hall

[Emma Reynolds (Wolverhampton North East) (Lab)]

I beg to move,

That this House has considered bailiff regulatory reform.

As ever, Mr Evans, it is a pleasure to serve under your chairmanship, and I wish all hon. Members a happy new year. As we embark on a year that will be dominated by Brexit—as we saw in the Chamber just a minute ago—it is good to focus on another concern of our constituents. I called for this debate on reforming the regulation of bailiffs because a shocking case of aggressive behaviour by bailiffs in my own constituency was presented to me at an advice surgery, and I have heard countless other examples from hon. Members and from the charities involved. I thank my local paper, which published an article on the topic over the Christmas period, and members of the public who got in touch with me.

My main message to the Minister is that we simply cannot let bailiffs become a law unto themselves. The Government need to take urgent action against bailiffs who break the rules, behave aggressively and act with apparent impunity. According to the evidence presented by Citizens Advice, StepChange and other organisations, this is not just a few bad apples, but a widespread problem. Although I welcome the call for evidence that the Government announced last year, I stress to the Minister that we are not discussing a minority of bailiffs, and I urge her and her Department to recognise that. After all, we have to face up to the scale of the challenge if we are to find the right solutions.

Some 2.2 million people in England and Wales have been contacted by a bailiff in the past two years. The regulations that the Government introduced in 2014 are welcome, but there are huge problems with the lack of enforcement. Since the introduction of those reforms, Citizens Advice has recorded a 24% increase in problems with bailiffs. One person in three who has experience of bailiffs has seen them breaking the rules, and 40% have suffered intimidation. Unfortunately, the fee structure has created a perverse incentive for bailiffs to make visits and reject repayment offers, which we have seen time and again, as they can charge fees of £235 for every debt they collect in person.

I first became aware of the severity of this problem last year, when a disabled constituent came to see me at an advice surgery. Let us imagine for a moment being in her shoes: you and your partner are just getting up. You hear a knock at the door. Your partner goes to answer it. You hear loud voices, then feet on the stairs. A total stranger strides into your bedroom. You are absolutely terrified. The first thing he does is pick up your purse and take out all the cash. You think you are being burgled, but you are not: you are being visited by bailiffs. My constituent’s experience, unfortunately, is not an isolated case. Another man told me that bailiffs used humiliation in front of his neighbours to gain entry to his home. He said:

“They tried to push their way into my house saying they have a right to. When I asked to see the court papers the bailiff said—you have already had them and he would only discuss the case in the house. He then started shouting so that other people”

including his neighbours

“could hear him—this was obviously to embarrass us”

and to intimidate the man.

[Mr Ranil Jayawardena (North East Hampshire) (Con)]

I congratulate the hon. Lady on securing this important debate on an issue that is faced by people across the country. Regarding the point she has just raised, does she agree that the current regulations give perfectly innocent people no opportunity whatsoever to prevent a visit by bailiffs or verify the authenticity of visiting bailiffs when they are not the debtor concerned? One of my constituents faced that situation—a traumatic ordeal along the lines that the hon. Lady has outlined.

[Emma Reynolds]

From all the cases that I have heard about, those experiences are traumatic and have a lasting effect on the people involved. In many cases, they are not necessarily the debtor—they are not the person who owes the money—but they are still treated in an appalling manner. That is not to say that the debtor should be treated appallingly either, but bailiffs do not seem to have regard to the rules, which is that they can seize possessions that belong only to the debtor.

That brings me to another example—a person from the constituency of the hon. Member for Harborough (Neil O'Brien), whose son was in debt and who bravely spoke out on the radio today about his experience. He said:

“We invited these men into our home so that we could understand what was going on and in the belief that we could then work with them to resolve the problem. All they did once inside our home was to threaten us with public humiliation. At no time did they advise us of any of our rights. We were told that although we were in our own home that the only way we could prevent them seizing our property”,

including this gentleman’s car,

“was if we could produce receipts.”

I do not know about other Members, but I would not have a receipt for my car at hand if someone were to knock on my door. I know that the hon. Member for Harborough will speak in more detail about his constituent, whom I thank for coming forward.

In another case, a woman told me:

“I went to close the door and the bailiff put his foot in to my hall to prevent me from shutting the door. I got through to the police, explained the situation, was told he had no right to demand to come into my house. The bailiff had gone by then and did not return but I felt very intimidated and for a while found myself checking through the window before opening the front door.”

How awful that a person should not feel safe in their own home.

[Dr Matthew Offord (Hendon) (Con)]

I congratulate the hon. Lady on securing this debate. I wanted to raise the case of a constituent of mine, in which a bailiff put his foot in the door because he wished to enter the property, but the property he wished to enter did not belong to my constituent—the bailiff wanted to see a tenant of my constituent. Even so, not only did that cause a lot of problems when the police were eventually called, but of course the body camera worn by the bailiff was not working at the time, so no one corroborated whether my constituent was indeed assaulted.

--- Later in debate ---

[Emma Reynolds]

How very convenient for the bailiff involved! We had a similar case in my constituency. At one point, we were told that there was a body cam, but when we pressed to see the footage, we were then told that there was not a body cam. The hon. Gentleman raised that in the form of a written question to the Minister and we should consider it. It will not solve all of our problems, but it would go some way towards helping to look at these disputes.

One man told me that, although he had moved out of his mother’s house and the debt was his and not hers, the bailiffs told her that if she did not pay, her son would go to prison. They marched her to the post office, where she was pressed to withdraw £550 to cover the debt. His mum was 73 at the time. There are countless examples of bad practice from all over the country.

[Rachel Reeves (Leeds West) (Lab)]

Like other Members, I congratulate my hon. Friend on securing this debate. Is she aware that there is a private bailiff trade body called the Civil Enforcement Association? Its code of conduct says that its members should be

“professional, ethical…polite, honest and non-threatening”,

yet all the examples that my hon. Friend has given are of behaviours that are the exact opposite. In 2016, the Civil Enforcement Association received 255 complaints about its members yet expelled none of them. Is that not a perfect example of why we need better enforcement and regulation of the bailiff industry?

[Emma Reynolds]

I could not agree more. I have had contact with that trade association. It is simply not realistic to expect a trade association, which is there to represent its members, to take action against those members. In fact, the lead of that organisation was on “World at One” on Radio 4 today claiming that there was a robust complaints procedure. I beg to differ and will address that point towards the end of my speech.

The worst case of this kind that I have heard—I know that my hon. Friend the Member for Croydon Central (Sarah Jones) has raised it with the Minister and will speak about it today—is the devastating case of Jerome Rogers, who took his own life. He had offered to pay back the debt in stages, but the bailiffs refused. I pay tribute to the brave campaigning of his family, who are here today. We owe it to them to do all we can to change the culture of the bailiff industry so that they are there to help, not penalise people. There is a positive example from Hammersmith and Fulham Council in London, which has stopped using bailiffs to enforce the collection of council tax arrears because it thinks it is better to try to work with the people involved and help them pay back that debt rather than forcing them into a spiral of ever more debt.

[Andy Slaughter (Hammersmith) (Lab)]

I am grateful to my hon. Friend for mentioning Hammersmith and Fulham Council, which as she correctly said stopped using bailiffs to enforce council tax debts from April last year. Collection rates have not gone down since. One council cabinet member said:

“We have done this by intervening early with residents who may have trouble paying council tax, speaking to them in a respectful and supportive way to develop a sustainable repayment plan that both protects the council’s income while avoiding forcing people into making bad financial decisions to avoid bailiffs, such as resorting to payday lenders or missing rent payments.”

Should not all local authorities and anyone trying to enforce debts adopt that as their philosophy?

--- Later in debate ---

[Emma Reynolds]

I could not agree more and would love to see other councils around the country follow that example, for which I thank my hon. Friend, who I am sure played a part in bringing that about. When we hear these cases, it is incumbent on all Members of Parliament to bring them to the Government. It is incumbent on all councils and any other public authorities that are owed money to seek a constructive way to get that money and to help people pay that debt back rather than threatening them with bailiffs.

[Mr Jim Cunningham (Coventry South) (Lab)]

I congratulate my hon. Friend on securing this debate. Five or six years ago, I had a Bill that would have established an independent body to regulate bailiffs. I had some very nasty cases in my constituency at the time, which prompted me. Unfortunately, the Bill did not go through because the Government stopped it. I hope my hon. Friend’s Bill gets through, because it is important that we regulate bailiffs properly and give them proper training.

[Emma Reynolds]

An independent regulator, training for bailiffs and standards that are enforced are essential—I will come to that towards the end of my speech. I put on record my thanks to my hon. Friend for trying to push the issue a few years back. I hope I can follow in his footsteps. I have applied for a ten-minute rule Bill, and I hope I can get something on the statute book, although I also hope the Government will beat me to it.

The examples I quoted remind us that anybody could end up in this situation, although in many cases, the people involved are vulnerable. Often it starts with a small fine or debt that escalates, and it can spiral out of control. Citizens Advice recently found that such experiences have a very negative impact on people’s mental health and financial position. Some of those who are likely to fall into debt already have a mental health problem.

[Ellie Reeves (Lewisham West and Penge) (Lab)]

Bailiffs are supposed to have training to identify vulnerable people and to behave appropriately, but the reality is that it is not always obvious that someone has a disability or is suffering from mental ill health. Much more robust legislation needs to be put in place to protect those people.

[Emma Reynolds]

We need more robust rules and we need more robust enforcement. My constituent is disabled and was facing a fine because her disability badge was out of date. That was because she was moving from disability living allowance to the personal independence payment—that is another story. She was told by the bailiff that she did not look disabled. Her vulnerability has been questioned at every turn when I have raised her case. I thought it was obvious, because she is disabled, that she is vulnerable, but it is not always that obvious, as my hon. Friend says. We need much better procedures in place so that bailiffs recognise that.

Of those who had a negative experience with a bailiff, Citizens Advice found that seven in 10 reported increased stress and anxiety. I am sure that that very much chimes with the experience of the constituents that Members are here to represent. It certainly chimes with the experience of mine. Eight in 10 felt that the experience had a lasting effect and one in two saw their finances deteriorate further.

[Bambos Charalambous (Enfield, Southgate) (Lab)]

Is the practice by bailiffs of not accepting affordable repayments a cause for people getting further into debt, thus exacerbating the problem and leading to unfortunate experiences for those people?

[Emma Reynolds]

Indeed it is. It seems to me that it is not in the interests of the local authority. For instance, Hammersmith recognised that if people are forced into more debt, they are unlikely to be able to pay it off. As I understand it, there is no compulsory obligation on bailiffs to accept a repayment plan, which the Government should consider carefully. In fact, all the incentives seem to be stacked against the bailiff being cautious or sympathetic to the debtor. All the incentives seem to be for the bailiff to collect as much money or as many possessions as possible on that visit.

Bailiffs have extraordinary rights to seize possessions and the police are the only other profession that I can think of that is permitted by law to enter someone’s property. The police can do so only if someone is suspected of serious criminality and they have to secure a search warrant and read someone their rights. Those with a complaint can report the police to the Independent Office for Police Conduct. Bailiffs too need a court order, but there seems to be no requirement for bailiffs to tell someone their rights. Indeed, evidence suggests that bailiffs often misrepresent people’s rights to gain entry to their home and seize possessions.

[John Howell (Henley) (Con)]

The hon. Lady is moving on to the area of complaints, which is close to my heart. Does she agree that there needs to be a simple system that people can use that includes something like mediation—alternative dispute resolution—that is quick to implement but very friendly and not as intimidating as going to court?

[Emma Reynolds]

The hon. Gentleman pre-empts the next section of my speech, which is all about that. Short of taking a bailiff to court, there is no meaningful way of seeking redress, because there is no simple or clear complaints procedure. Arguably there is no meaningful complaints procedure, although I will come to that.

In the case of my constituent, I complained to the local council, which was enforcing a parking fine. The council and I complained to the bailiffs company, but it disputed my constituent’s version of events. I complained to the bailiffs trade association, which we have discussed. I got a letter back saying that it was the word of my constituent against the word of the bailiffs. I raised the case in Parliament and we are having a debate today, but even as an MP, I felt powerless to take the case any further, which was deeply frustrating. Can it be right that, short of taking the case to the courts, our constituents have no other means of redress? It cannot, and the bailiffs know it—they know that most people in debt will not have the money to take them to court. There have been only 56 complaints in the courts since the 2014 reforms despite reported widespread bad practice.

One couple explained to me that their attempts to take a complaint forward had been blocked at every opportunity, including by claims from the bailiffs company that letters had been lost in the post—that old chestnut—and had taken nearly a year and cost thousands of pounds. Bailiffs are largely unaccountable, which is why I am calling on the Government to bring forward urgent reform.

Specifically, I call on the Minister to take forward the proposal of a cross-party group of MPs led by my hon. Friend the Member for Leeds West (Rachel Reeves). In a letter sent to the Minister today, they ask the Government to set up an independent regulator to enforce the rules. The regulator, which could be an existing body or a new body, should have a range of powers and responsibilities to set and enforce rules, and standards for bailiffs, and to take both a reactive and proactive approach, investigating firms and individuals where there are complaints but also proactively monitoring standards. Crucially, a regulator must ensure access to redress. Alongside that—this speaks to the point of the hon. Member for Henley (John Howell)—we need a fair, free, simple and transparent complaints procedure.

Crucially—I very much speak on behalf of my disabled constituent on this point—bailiffs must be required to identify vulnerable households. To end the targeting of vulnerable people, there have to be clear procedures for referring debts back to creditors when enforcement is not appropriate.

The impact of those reforms must be to change the culture of the industry. There are not enough sanctions on bailiffs, and all the incentives drive bailiffs in the wrong direction—to penalise people rather than help them. The debt advice charities are highly regulated. The debt collectors are also regulated. The bailiff industry is an anomaly. I ask the Minister to take urgent action. They are not difficult reforms and, crucially, implementing such changes would mean that bailiffs played by the rules and treated people with the respect that they deserve.

[Several hon. Members rose—]

--- Later in debate ---

[Rachel Maclean]

Yes. I thank my hon. Friend for that intervention; I completely agree. I was going to say that this particular firm is not against further regulation at all. It merely makes the point that it needs to be done in consultation with the debt enforcement agencies, looking at the best practice of some of the good agents, who carry out vital work that needs to be done to recover funds that will go into our local government coffers. When I visited that firm in my constituency, it made the point that its recovery rate is much more effective than those of some of its competitors. It is the second largest enforcement agency in the country and covers 16% of all local authorities’ collections. It is not the one that the hon. Member for Wolverhampton North East (Emma Reynolds) referred to, and it does have a good reputation locally. I wanted merely to place that on the record, and I agree with my hon. Friend that we need to totally overhaul the system.

[Emma Reynolds]

I am interested in what the hon. Lady is saying. She has made an important point about that company employing its agents directly. Does she feel that that has made a difference in its behaviour and practices?

[Rachel Maclean]

Absolutely. I have visited the company, which is a long-standing employer in the constituency. People have worked there for many years, starting their careers in that business. The company takes that very seriously, otherwise it would not have loyal employees for such a long period who care about doing their jobs properly and respectfully and about treating their clients with dignity in extremely difficult situations. That gives further assurance that there is proper oversight.

--- Later in debate ---

[Emma Reynolds]

I thank Members from across the House, including our Front-Bench spokesperson and the Minister, for contributing to this debate. They have given such powerful examples of bailiffs’ poor, aggressive and intimidating behaviour. What has been striking about this debate—it is not always the case in this place—is the cross-party consensus that the current system of self-regulation is not working. There is a need for an independent regulator, a clear and simple complaints procedure, the training of bailiffs and better protection for vulnerable people.

I welcome the Government’s call for evidence and the Justice Committee’s inquiry, which has just started. We must see this issue in the wider context of rising household debt, as mentioned by my hon. Friend the Member for Leeds West (Rachel Reeves). The need for change is urgent. We have to do more to root out aggressive and intimidating behaviour. We have to address the anomaly that somehow bailiffs are not properly regulated but debt advice charities and debt collection agencies are. Above all we must ensure that, in a civilised society, everybody is treated with respect. The focus should be on helping people who get into debt to get out of debt, not forcing them into a spiral of despair, which in some cases has led to the most tragic events, as we have heard, with Jerome Rogers taking his own life.

I know that the Minister is listening to Members of different parties, and I thank her for doing that. I hope that after the call for evidence, the Government can quickly put in place these reforms, for which there is cross-party support. I hope that we can work together to ensure that this aggressive behaviour is rooted out.

Question put and agreed to.

Resolved,

That this House has considered bailiff regulatory reform.