Bailiffs: Regulatory Reform

Nigel Evans Excerpts

Wednesday 9th January 2019 Westminster Hall

[Several hon. Members rose—]

[Mr Nigel Evans (in the Chair)]

Order. As Members can see, there is a lot of interest in taking part in the debate. I intend to call the Front Benchers just before 3.40 pm. I plead for self-discipline and restraint regarding time when Members make their contributions. I call John Howell.

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[Several hon. Members rose—]

[Mr Nigel Evans (in the Chair)]

Order. We are looking for contributions of around four minutes if everybody is to get in. I call Sarah Jones.

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[Several hon. Members rose—]

[Mr Nigel Evans (in the Chair)]

Order. If I let hon. Members know that their speeches are timed on the monitors, it may assist them to keep to the four-minute mark.

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[Justin Madders]

I am sorry; other people want to speak, so we have to move on.

An even worse example was when a constituent had agreed a payment plan with bailiffs, which she was paying on time and in full. She then received a letter from the bailiffs requesting that the repayment increase by £30 a week. There never was and has not been any justification given for that proposal. Following that request, and despite the constituent asking for an income and expenditure form to demonstrate that she could not afford the increase, she then received a letter asking that the full debt be repaid within 24 hours or goods would be removed. There then followed the threatening phone calls and visits to the property that we have often heard about. Such despicable behaviour cannot be justified, but in this instance, as in many, the original creditor had washed their hands of the whole business. They do not seem to care how unreasonable, threatening or intimidating the bailiffs get. They just want their money back. Even if they are outsourcing responsibility to recover the debt, they should not outsource their responsibility to ensure that the debt is recovered in a responsible manner.

Demands for unaffordable payment plans are probably the most commonly occurring issue that we get. We often find that bailiffs are unwilling to negotiate and then ask for the full amount owed. They even suggest that debtors should borrow more money to repay the debt. As we have heard, the situation is exacerbated by adding hundreds of pounds to the debt once a visit has been made by a bailiff, which can lead to punitive increases that are often totally disproportionate to the original sum being recovered. I appreciate that those wishing to recover the debts need to recover their own costs as well, but the fees, which are then treated as part of the debt, cannot make it any easier for the individual to repay the debt.

In conclusion, I support Citizens Advice’s call for the Government to report annually on the debt to Government and essential service providers, and for the introduction of an independent regulator for the bailiff industry. It is time we gave people confidence that the difficult issue of debt enforcement will be given the same checks and balances that we rightly expect in many other areas of our lives.

[Mr Nigel Evans (in the Chair)]

If hon. Members aim for the three-minute mark, perhaps we will be able to get in everyone who wants to speak.

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[Gloria De Piero]

I thank my hon. Friend for that contribution. Story after story shows why reform is necessary. Unlike similar industries dealing with vulnerable people, such as debt collectors, the bailiff industry is not overseen by an independent regulator. As Labour recognised with our successful payday loan campaign, self-regulation is just not suitable for industries with intrusive powers over vulnerable people’s lives, homes and finances. It is just too easy for unscrupulous companies to be greedy or to mistreat people when they are at their lowest. None of the main trade bodies for bailiff companies seems interested in enforcing the law or holding the industry to account, and even if they were, they do not have the teeth to do so, just as we saw with payday lenders.

There is also no simple, accessible complaints system for people to report the horror stories or infringements of the bailiffs they are dealing with. The only thing that will do, as so many colleagues have said, is to replace the broken system of self-regulation and piecemeal reform with independent bodies that will hold the industry to account and allow people’s complaints to be heard and dealt with. We need either a new regulator or to bring bailiffs within the remit of the Financial Conduct Authority—that went a long way towards reining in payday lenders. It does not matter what body we choose as long as it is fully independent and has the teeth and the will to put a stop to unscrupulous behaviour.

We also need a simplified, free, independent complaints procedure, adjudicated by an independent body. We need to listen to the myriad voices calling for change—organisations that in many cases are working on the frontline of the effects of the broken bailiff system. They include AdviceUK, the Children’s Society, Christians Against Poverty, Citizens Advice, Community Money Advice, the Institute of Money Advisers, the Money and Mental Health Policy Institute, the Money Advice Trust and StepChange Debt Charity.

Many colleagues said that the current system is not fit for purpose. The hon. Member for Henley (John Howell) talked about the current system of regulation not working because there are no sanctions, as did the hon. Member for Thirsk and Malton (Kevin Hollinrake), who also brought a mental health angle to the discussions and suggested some practical solutions. My hon. Friend the Member for Leeds West (Rachel Reeves) talked knowledgeably about how the law needs to change, and made a wider point about use of bailiffs being a symptom of increasing household debt. The hon. Member for North Antrim (Ian Paisley) brought a Northern Ireland perspective to the debate and talked about how enforcement orders are used. My hon. Friend the Member for Ellesmere Port and Neston made a wider, and important, point about the need to be tough on bailiffs and tough on the causes of bailiffs. My hon. Friend the Member for Makerfield (Yvonne Fovargue) talked of desperate people chasing desperate people and brought her long-standing expertise to the debate. My hon. Friend the Member for St Helens South and Whiston (Ms Rimmer) talked about how the complaints system is not working and is not fit for purpose, and the wider issue of poverty.

There really is no excuse for the Minister not to act. As the hon. Member for Redditch (Rachel Maclean) explained, some of the bailiff companies are themselves calling for independent regulation. I have a fundamental request. Will the Minister agree to enact a properly independent regulator, and will she set a timetable today to do so? Will she also urge other local councils to follow the example of Hammersmith and Fulham and not use bailiffs? Will she heed the call from the hon. Member for Hendon (Dr Offord) for councils to look at how they deal with repossession and rehousing? Every day that we wait is another day of stress and despair for too many people struggling with bailiffs.

[Mr Nigel Evans (in the Chair)]

I remind the Minister that it is customary to leave a minute or so for the proposer of the motion to wind up.