Member Article

Citizens Advice calls for debt collection reforms.

Citizens Advice is calling on government departments to address their debt collection practices, after a new report from national Citizens Advice found that nearly £1 in every £5 of the debt people contact them for is now owed to government.

In the last year alone Darlington Citizens Advice helped people with the following local and national government debts:

• 1,540 inquires in connection with council tax arrears.
• 217 inquiries regarding Tax Credits overpayments
• 359 inquiries regarding problems with overpayments of benefits, including Housing Benefit and Council Tax Reduction.
• 215 inquiries regarding magistrate court fines

Debt specialists from across the Citizens Advice service rated debt collectors from the private and public sector on how well creditors resolve disputes, set affordable repayment plans and how easy they are to contact.

The findings reveal poor practice among several government agencies with HMRC receiving the worst approval rating of 34 per cent. Water companies came out on top as the most responsible debt collectors.

The top concerns amongst advisers include the difficulties people face when trying to contact government departments. HMRC fared worse on this measure with 56 per cent of advisers saying they “rarely or never” get through to someone who can help.

Improvements also need to be made in setting affordable payment plans, with only 13 per cent of advisers saying that HMRC agreed debt payments that their client could afford to make.

The department was also found to be poor at resolving disputes with 48 per cent of advisers reporting that HMRC Tax Credits collections staff were rarely or never co-operative.

Neeraj Sharma, Citizens Advice Darlington chief executive, said: “Debt collection is never easy, but it should be done in a fair and just manner.

“Of course people must repay government debts as soon as they can, but there is a difference between people who can’t pay and won’t pay.

“The report’s findings show government departments are sometimes forcing people to pay a debt when it is still under dispute and aren’t leaving room to consider if people can afford debt repayments.

“The Government should be leading the way on good debt collection practices, not trailing in last place. It is important government works with their private sector counterparts and debt charities to make improvements.”

Citizen advice offers advice and support at https://www.citizensadvice.org.uk/debt-and-money/ and offers a range of options for people struggling with debt. Citizen Advices also offers a helpline on 0325 256999 if clients wish to speak to an advisor about debt troubles.

This was posted in Bdaily's Members' News section by Citizens Advice Darlington .