Would self-regulation of bailiffs work?
The proposals aim to better protect people in debt, but financial experts say the plans don’t go far enough.
The CSJ formed an Enforcement Oversight Working Group last year to look at how regulation of the debt collection sector could work. The group has written a report called Taking Control for Good – introducing the Enforcement Conduct Authority.
The report that lays out plans to set up a new body called the Enforcement Conduct Authority (ECA) which would aim to raise bailiff standards with new rules to be developed in consultation with the industry. The new body would also supervise the practice of bailiffs and issue sanctions for rule-breaking and sub-standard behaviour.
The ECA would have a standardised two-stage complaints process and a process for independently adjudicating escalated complaints. It’s hoped that this would “ensure fair treatment and protection” for those subject to bailiff enforcement, particularly people who are financially vulnerable.
However, while the CSJ says the new body will be independent, it will be funded by the bailiff industry. It also won’t be compulsory for all firms to follow the new rules, although it will be mandatory for the 95% of firms that are members of trade body the Civil Enforcement Association to sign up.
Joe Shalam, head of financial inclusion at the Centre for Social Justice, said: “Leading debt charities and enforcement firms have worked pragmatically and at pace to radically improve the protections for people in debt. The joint proposals published by the Centre for Social Justice today for an Enforcement Conduct Authority (ECA) have been welcomed as a landmark breakthrough.”
But Martin Lewis, founder of MoneySavingExpert.com, warns that the news body doesn’t go far enough.
He said: “I am concerned this may be a pyrrhic victory. While any regulation is a welcome improvement in the short term, this self-regulation will not cover the whole industry. We cannot simply allow the companies that are willing to be policed, to choose to police themselves, with the rest remaining on the outside. We need every company in the industry to be tightly and independently regulated.
“After all, it is possible over 50% of those being dealt with by bailiffs have mental health issues and vulnerabilities – so this isn’t an arcane philosophical discussion, lives are at risk. While I do expect these voluntary trade rules to mean some improvement, the problem is that it is a sop to the Government and bailiffs, letting them off the hook from bringing in proper, statutory-based, compulsory regulation that all firms must follow.”