Bailiffs: Regulatory Reform

Debate between Ruth George and Gloria De Piero

Wednesday 9th January 2019 Westminster Hall

[Gloria De Piero (Ashfield) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Evans. This has been a fantastic debate from which I have learned a great deal.

I am pleased that my hon. Friend the Member for Wolverhampton North East (Emma Reynolds) secured the debate to shine a light on the case of her disabled constituent, who thought she was being burgled when debt collectors forced their way into her home without showing ID, and stole cash from her purse. As we know, that was not an isolated incident. The hon. Member for Harborough (Neil O'Brien) described a case where constituents of his suffered total humiliation. My hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) talked about threatening and intimidating behaviour, and my hon. Friend the Member for Great Grimsby (Melanie Onn) spoke of vulnerable constituents receiving threatening letters and living in fear and anxiety.

My hon. Friend the Member for Croydon Central (Sarah Jones) spoke about the tragic death of Jerome Rogers. That should concentrate all our minds on the importance of this debate. Jerome was a young man with plenty to live for when he took his own life, but it seems he felt that he just could not go on in the face of the stress and despair he felt after months of interaction with bailiffs. Looking at his story, it is striking how unfair and pointless his treatment was. He was struggling with debt and trying to get out of it, but the odds were stacked against him.

Two unpaid £65 traffic fines spiralled to debts of more than £1,000 in a matter of months. Sky-high bailiff fees meant that there was virtually no cap on what they could take from Jerome. Knowing he could not cope with the debt and the eye-watering fees, he contacted the bailiff company and the individual bailiff dealing with his case, asking to set up an affordable repayment plan. He was met with a flat refusal and little to no human compassion. At least he could earn some money using his motorbike to deliver blood supplies to London’s hospitals—but no. It seems that the bailiffs were systematically cutting off every escape route he could think of. They clamped Jerome’s motorbike, despite the fact that its value fell far below the £1,350 threshold for seizing or taking control of goods. Not only did Jerome have no money and no agency to solve his problems, but he had the added pressure of the intimidating presence of a bailiff outside his home. The stress was unimaginable, and ultimately Jerome just could not take it anymore.

As many people have said, we are not talking about a one-off case, or a few rogue bailiffs and their firms. Recent research from Citizens Advice shows that one person in three has experienced bailiffs breaking the rules, and half of StepChange Debt Charity’s clients said their bailiff refused to accept an affordable repayment offer. This is a systemic failure in our society that must be dealt with.

The legislation covering bailiffs is complex and fragmented. It has failed to protect vulnerable people going through hard times from aggressive and intimidating behaviour. There were some positive measures in the 2014 reforms to taking control of goods, but they just have not worked. It seems that bailiffs are ignoring many of the provisions, as they did when seizing Jerome’s motorbike, refusing affordable payment plans or engaging in threatening behaviour. We cannot allow the bailiff industry to continue marking its own homework.

[Ruth George]

I have had similar problems in my constituency with the bailiffs hired by my local council. Bristow and Sutor—a company that the hon. Member for Redditch (Rachel Maclean) mentioned—uses cameras to take photos of people’s possessions and threatens them with those possessions being sold off if they cannot pay a full demand up front, immediately. It also refuses payment plans. My constituents say its bailiffs have even visited elderly relatives, refused to leave their properties and made them feel intimidated. I am sorry to say that even where we have better practice, with directly employed agents, very serious complaints are still being made.

[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.

Civil Liability Bill [Lords]

Debate between Ruth George and Gloria De Piero

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 23rd October 2018 Commons Chamber

[Gloria De Piero]

Exactly. I do not think anybody in this House will want to shed a tear for those insurance companies whose profits are going up and up. In 2017, profits for Direct Line went up 52% to £570 million and Aviva recorded a profit of £1.6 billion—and I have not even talked about the packages that some insurance company bosses take home.

The Government appear to have rounded this figure up. We say base the figure on the advice and recommendations of countless experts and follow the evidence. Even if the hon. Member for Croydon South (Chris Philp) does not listen to me, I wish he would follow the evidence of the experts. New clause 1 does just that. It would increase the limit only by CPI since 1999 and limit any increase to £1,500. That way, injured people with significant injuries and potentially even more significant losses will get the representation they need and deserve.

[Ruth George (High Peak) (Lab)]

Does my hon. Friend agree that in the case of an accident at work it is even more important that an injured employee is able to get legal representation to take a case against their employer? The employer will be armed with lawyers and their employers’ liability insurance company. That is stacked up against an individual whose task will be hard enough. They will be feeling victimised enough as it is.

[Gloria De Piero]

My hon. Friend is absolutely right. It is not an easy thing to take a case against your boss. You need a lawyer to hold your hand, an expert to talk you through, and the Government’s proposals are going to make that so much more difficult. She makes an appropriate point.

New clause 2 would ensure that children and protected persons, for example those lacking mental capacity, are treated the same as other vulnerable groups by excluding them from the small claims limit increase for whiplash injuries. Having made a welcome concession on Second Reading, and clarified in Committee that they would exclude vulnerable road users from the impact of the Bill and secondary measures on the small claims court limit, the Government appear to have forgotten others. Horse riders, pedestrians, motorcyclists and cyclists are rightly to be excluded from the changes, but some of the most vulnerable in our society, who are currently recognised by the courts as requiring special status, will be left, with everybody else, facing a new small claims limit of £2,000 or £5,000. As it stands, any settlement awarded to those who lack capacity to conduct their own proceedings, such as children or someone suffering with a mental disability, must be rubber-stamped by a judge because of the claimant’s recognised vulnerabilities. That will continue to be the case after these changes are introduced.

The law requires children and other protected people to have a litigation friend to conduct proceedings on their behalf. In the small claims court, those who provide this required representation are not and will not be paid for their time. Yet by increasing the small claims limit, there will be a significant increase in the number of people coming through the small claims court with higher-value and more complex cases, where they need a lawyer more than ever. We are asking a litigation friend to take on potentially complicated matters for those most in need, on their own, in their own time, for no pay. Injured horse riders, cyclists and pedestrians and motorcyclists will not be subject to a tariff. The small claims limit for them will remain at £1,000, meaning that they will get a lawyer to act for them for free in any case over that value.

Can the Government not see that children and protected persons need this support, too? How on earth can the Government justify protecting one vulnerable group but not another? Why is the horse rider worthy of exemption, but not a child or a person without the capacity to conduct proceedings? Are we really willing to let some of the most vulnerable people in our justice system be left simply to hope for the good will of others to protect their interests because we in this House have failed to do so?

I know that the Minister is aware of this issue from discussion in Committee with my hon. Friend the Member for Enfield, Southgate (Bambos Charalambous). The Minister suggested returning to this point and that he would be very interested to see an amendment tabled. So here is his chance: a ready-made amendment that makes a simple correction and is an opportunity for the Government to rectify what I presume is an oversight. It simply extends the exemption already provided to others. It removes children from the changes being made to the small claims limit or tariff, and ensures that protected groups are excluded from the increase, the same as horse riders, cyclists and pedestrians. It removes the double standard of some vulnerable road users being granted an exemption and others not. Ultimately, it does little more than extend the protections already afforded to some and allow the Government to show that they care for all.

[Chris Philp]

Thank you, Mr Speaker, for calling me so early in this debate. I rise to oppose the Opposition’s new clause 1, which seeks to prevent the Government or any other public body from increasing the small claims track limit in relation to these personal injury cases, particularly road traffic personal injury cases, above £1,500.

I strongly oppose the measure. I touched on one of the reasons for doing so in my intervention on the shadow Minister earlier. For the vast majority of general commercial claims and indeed personal claims, the small claims track limit is £10,000. The reason it is as high as £10,000 is that some level of materiality is applied to the claim in question. The view taken by Parliament in the past, rightly, is that matters below the £10,000 limit should be sufficiently simple for a small claims track procedure to be used without the involvement of often very expensive lawyers.

In response to my intervention, the shadow Minister, before she was distracted by another intervention, drew attention to the fact that these are personal injuries. I accept that point, of course. However, the fact of their being personal injuries is not germane, in my view, to the question, which is: is the matter sufficiently simple to be adjudicated via the small claims track rather than through lawyers? That is the question—not whether the matter is serious or not serious but whether the matter is sufficiently simple to be dealt with properly by the small claims track rather than through lawyers. That is why I think there is a strong a case, on the grounds of consistency, for a £10,000 rather than a £5,000 limit.

Civil Liability Bill [ Lords ] (First sitting)

Debate between Ruth George and Gloria De Piero

Committee Debate: 1st sitting: House of Commons
Tuesday 11th September 2018 Public Bill Committees

[Gloria De Piero]

The Bill says that if someone’s whiplash injury goes on for up to two years, or if it is thought that it might go on for up to two years, or if it goes on for up to two years because of their failure to “mitigate” their loss—that is, act to get themselves better by taking up an offer of physio, for example—they are eligible for fixed-tariff damages only.

Since 1999, special damages have been exempted from the calculation of whether a claim falls within the small claims limit. I will take this opportunity to nail down the ongoing argument about when the last increase in the small claims limit was. The Government say 1991, which is disingenuous and borders on the dishonest. I can provide quotes from the White Book if the Minister would like to see them. The limit has remained at £1,000 since 1991 but the method of calculating whether a claim falls within that limit changed in 1999 after the Woolf report. If any doubt remains, the evidence can be found in extracts from the White Book before and after the change.

From 1999, a definition of what was included in the £1,000 limit excluded special damages. It contains a helpful example that leaves no doubt that only general damages should be considered to see if a case is within the limit, and special damages are exempted from that time. I am told that special damages in a case add 20% to a claim on average, which means that the change in 1999 increased the limit by 20%. I shall assume that we have now laid that matter to rest and that any calculation from now on will be from 1999, not 1991. We may argue about the appropriate inflation index, or even the percentage increase from the changes made, but there should be no argument about the date from which it applies.

The impact of the clause is that someone could be off sick and losing wages, or having to work reduced hours, because of their whiplash complaint for up to two years before they are taken out of tariff damages. The Office for National Statistics says that the average wage in the UK was £27,200 in 2016-17, so an injured worker could lose more than £50,000 in earnings and still be subject to tariff damages. Someone on the minimum wage of £7.38 who works 35 hours a week for 48 weeks a year might earn £12,400, so they could have no income at all to support themselves and their family for up to two years.

[Ruth George]

Does my hon. Friend agree that the proposed tariff takes no account of victims’ circumstances? A whiplash injury will have a greater effect on someone in a manual job, who is less likely to be able to perform that job, than someone in a sedentary position, who is more likely to be able to continue to work through minor injury. Someone in a manual job is also likely to have lower wages and be less able to sustain a certain level of loss.

[Gloria De Piero]

My hon. Friend is completely in touch with the reality of life for working people. That is the argument that we seek to make. In tabling amendments 10 and 11, which bring that two years down to 12 months, we concede that people recover and that that can take time. We are not suggesting a short period, but a reasonable one, and we hope that the Government will concede that it is fair and proportionate.

On amendments 12 to 16, it is proposed that the Lord Chancellor should set the tariffs for pain, suffering and loss—