Agenda item

The Panel received a deputation from Haringey Acorn in relation to the Council’s use of private sector enforcement agents to collect outstanding Council Tax debt. The deputation party were Eleanor Whitlock (lead signatory), Owen Kennedy, Elizabeth Cabeza, Kyra Carty and Reuben Bard-Rosenberg. The key points of their deputation is summarised below:

·         The deputation party asked the Committee to scrutinise bailiff use across the borough. Acorn believe that the Council should commit to end use of private bailiffs to collect Council Tax debt and should commit to finding a new approach.

·         Acorn started campaigning in 2022 for an end to the use of private sector bailiffs and are now campaigning on the issue nationally. A number of Council’s have changed their policies.

·         It was suggested that there were three main issues with Haringey’s approach:

1.    Using bailiffs was an aggressive and intimidating way to collect Council Tax debt. Citizens Advice Bureau estimated that one-third of people who interacted with bailiffs were subject to behaviour that broke the law. 60% of people reported intimidation  or harassment. It was contended that, therefore, use of bailiffs likely increased pressures on other public bodies, such as mental health services.

2.    Using private bailiffs to collect Council Tax debt did not improve people’s ability to manage their finances or help Council’s maximise their Council Tax income. Bailiffs added charges, compounding residents ability to pay. Policy in Practice found no correlation between bailiff use and Council Tax collection rates across London boroughs.

3.    Private bailiff companies were not incentivised to improve payment rates in the long term. They made money from levying additional charges on residents and always paid themselves first. It was suggested that if bailiffs actually managed to get residents to better manage their debts, they would go out of business. It was claimed that the introduction of the Ethical Debt Policy reduced the use of bailiffs slightly, however it had failed to significantly lower the use of bailiffs in the borough. It was suggested that last year bailiffs received nearly 9000 Council Tax cases in Haringey and that this equated to almost one-in-ten households in the borough.

·         It was asserted that the poorest, most deprived and ethnically diverse wards in the borough such as Tottenham Green and Northumberland Park were four times more likely to receive a call from a bailiff that the most affluent wards in the borough.

·         Twenty community groups, trade union representatives and local councillors had signed Acorn’s open letter to the Council asking it to ban the use of private debt collection agencies.

·         Acorn set out that the Council did not seem to have a clear understanding of the problem and the administration did not seem to want to work with Acorn to improve the situation.

·         To date, Cabinet Member responses to Acorn’s questions included assertions that bailiffs were mainly used to collect debts from landlords and people living outside of the borough. It was commented that tenants, rather than landlords were liable for Council Tax.

·         Acorn asserted that Haringey’s own data showed that bailiffs were being mostly sent to the poorest wards.

·         Acorn was advised that the Council was going to set up a working group on debt collection in 2023, but this didn’t seem to have happened.

·         Acorn asked the Committee to look into the issue and recommend policy changes to the Cabinet

·         The examples of Southwark; who brought debt recovery in-house and; Hammersmith and Fulham, who have ended their use of private sector bailiffs were given. The Committee was encouraged to reach out to other authorities to see what could be done.

The following arose during the discussion of the deputation:

a.    The Committee queried whether Acorn could provide some examples about the impact of bailiff visits. In response, Acorn advised that there were some testimonials provided as part of the submission. Of these, the first was a member who had a bailiff turn up at his door, he did not identify himself, acted in an intimidating manner and refused to leave. The second instance related to a women who was pursued for over a year for £1k of Council Tax debt that she did not owe. This resulted in a flurry of harassment through letters, calls and texts.

b.    The Chair sought clarification about the extent to which the issue was people were unable to pay, rather than an error had been made. In response, Acorn advised that they had a lot of conversations with people on the door step about bailiff use, but not everyone necessarily wanted to put their name to a testimonial. Acorn set out that one of the things they wanted the Committee to do was to go out and talk to residents’ about their experiences of being visited by bailiffs. It was suggested that the Council didn’t seem to have much information on who the bailiffs working on their behalf were. Acorn commented that as a small voluntary organisation they didn’t have the resources that the Council did.

c.    The Panel commented that the report at Agenda Item 8 set out that without use of enforcement agents, the Council would lose £2.5M in lost Council Tax revenue collection. In response, Acorn commented that this assumed that the Council wouldn’t be able to collect any of that revenue using a different method. It was commented that Hammersmith & Fulham had some success in sending agents round who were not bailiffs and were able to secure repayment plans.

d.    The Panel queried the assertion that the Council should set-up an in-house debt recovery service, given the cost involved and the precarious financial situation that the Council found itself in. In response, Acorn commented that they were asking the Committee to speak to other Council’s to see what was possible based on what happened elsewhere. As a way forward, Acorn suggested some intermediate steps such as; not sending bailiffs to homes that had families with children, introducing flexible payment plans, ensuring that residents were aware of their rights in the letters and correspondence that was sent to them and also have a section of the website with direct links of where residents could make a complaint if bailiffs had acted improperly. Acorn also commented that bailiffs added charges to debts and that money was invariably taken out of the borough.

e.    The Committee sought clarification about when Southwark and Hammersmith & Fulham brought in their revised policies. In response, Acorn advised that they were introduced in around 2017, but some of this had been done in stages.

f.     In response to a question, Acorn advised that an in-house debt recovery service would have more democratic oversight and residents could complain to local ward councillors if they had issues.

g.    The Committee commented that the Ethical Debt policy had been introduced in 2021 and this offered a range of support to residents. The Committee sought Acorn’s comments on the extent to which the Ethical Debt policy had made a difference. In response, Acorn advised that they believed that the policy had been most effective in relation to provision of information in one place. It was commented that the policy resulted in fewer people being funnelled towards bailiffs at the start of the process. However, once they were in that funnel the amount of people who progressed up each level, to the point of having a bailiff visit, didn’t really change.

h.    Acorn also commented that one of the promises made as part of the introduction of the Ethical Debt policy was that there would be special protection for vulnerable residents, effectively a triaging process to stop vulnerable people from getting into debt. When Acorn queried what the Council’s definition of a vulnerable resident, they eventually received a copy of the statutory guidance around bailiff use. Acorn suggested that there didn’t seem to be much of a working system in place to determine who was vulnerable.

i.      In response to a request for clarification, Acorn advised that the 9k households figure referred specifically to cases of people being referred to enforcement agents.

j.      In response to a further request for clarification, Acorn advised that that the assertion that bailiff usage was highest in the most deprived areas of the borough was a derived from correlating the number of visits in each ward with the wards that were the most deprived.

The Cabinet Member for Finance and Corporate Services was asked to provide a short verbal response to the deputation. The response is set out below:

a.    The Cabinet Member thanked the deputation party for their deputation and invited them to remain in the meeting for Agenda Item 7, which was a report on Council Tax (CT)  collection, support for residents and the use of enforcements agents in collecting CT debt.

b.    The Cabinet Member set out that Haringey was different, in that it had an Ethical Debt Policy. There were a number of steps taken by the Council before cases were referred to enforcement agents, as a last resort.

c.    The Cabinet Member emphasised that it had to be seen in context. Whilst it was appreciated that there were bailiffs that acted improperly, all bailiffs working for Haringey had to wear a body camera. The Cabinet Member advised that all of the complaints that had been received had been investigated and the body camera footage had been viewed. The Cabinet Member advised that on reviewing the footage, none of the cases involved the enforcement agent acting improperly. In reference to one of the specific cases referred to by the deputation party, the Cabinet Member advised that the use of an enforcement agent was appropriate, as the lead tenant had collected the money from the other tenants but had not paid the Council Tax bill and had ignored repeated warning letters.

d.    In terms of the locations of highest incidents of enforcement agents being used, the Cabinet Member advised that everyone knew that the borough was split east to west, with life expectantly varying by 8 years in the most to least affluent wards. The Cabinet Member set out that the same wards that had the highest number of visits by enforcement agents also corresponded to where the Council had given the most Council Tax reduction/exemption. It was stated that the Council was actively working to provide support to its residents in this area.

e.    The Cabinet Member advised that the most important thing was that residents got in touch with the Council if they were struggling to pay their Council Tax, as there were a number of internal Council organisations that could help them.

f.     The Cabinet Member argued that the last thing residents needed was a campaign that suggested the Council was deliberately targeting them and making them afraid to contact the Council and seek help. The Cabinet Member emphasised that the most effective thing that Acorn could do would be to encourage residents to contact the Council if they were having difficulty in paying their Council Tax.

g.    The Cabinet Member reiterated that answers to a number of the questions put forward by the deputation party would be discussed as part of the report at Agenda Item 7.