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You can find the current article at its original source at https://www.theguardian.com/commentisfree/2017/dec/21/council-tax-rises-bailiffs-arrears-national-debtline
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| Council tax rises will mean more people having bailiffs at their door | Council tax rises will mean more people having bailiffs at their door |
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| The news that local authorities will now be able to raise council tax by up to 5.99% next year will be welcomed by many in local government – but risks pushing many people who find it hard to make ends meet further into debt. At the Money Advice Trust, the charity that runs National Debtline, we are already hearing from more people than ever who are struggling to keep up with their day-to-day costs. The combination over the past year of slow wage growth, rising inflation and the impact of welfare reform is taking its toll on households’ budgets. | The news that local authorities will now be able to raise council tax by up to 5.99% next year will be welcomed by many in local government – but risks pushing many people who find it hard to make ends meet further into debt. At the Money Advice Trust, the charity that runs National Debtline, we are already hearing from more people than ever who are struggling to keep up with their day-to-day costs. The combination over the past year of slow wage growth, rising inflation and the impact of welfare reform is taking its toll on households’ budgets. |
| Coupled with this, we know that even the slightest change in personal circumstances such as relationship breakdown, illness or the arrival of an unexpected bill can have an impact on people’s finances. If councils implement the maximum increase of 5.99%, council tax bills could rise by £100 a year. | Coupled with this, we know that even the slightest change in personal circumstances such as relationship breakdown, illness or the arrival of an unexpected bill can have an impact on people’s finances. If councils implement the maximum increase of 5.99%, council tax bills could rise by £100 a year. |
| Of course for many households such a rise can be absorbed. But for the hundreds of thousands of people we help each year, this will make an already difficult financial situation that much worse. | Of course for many households such a rise can be absorbed. But for the hundreds of thousands of people we help each year, this will make an already difficult financial situation that much worse. |
| More than one in four callers (26%) to National Debtline now have council tax arrears, up from just 14% a decade ago. This is also one of the fastest growing forms of debt we are seeing - and rising council tax bills mean this trend is likely to continue. | More than one in four callers (26%) to National Debtline now have council tax arrears, up from just 14% a decade ago. This is also one of the fastest growing forms of debt we are seeing - and rising council tax bills mean this trend is likely to continue. |
| With council tax arrears increasing, it becomes increasingly important that councils collect debts in a fair and effective way. Unfortunately, many local authorities have a long way to go to improve their collection practices. Our recent Stop the Knock report highlighted the extent to which local councils are using bailiffs to collect debts. From data provided by councils through freedom of information requests, we found 2.3m debts were passed to bailiffs in 2016-17, a 14% increase on two years earlier. Of these referrals, 1.38m were for council tax arrears – an increase of 10%. | With council tax arrears increasing, it becomes increasingly important that councils collect debts in a fair and effective way. Unfortunately, many local authorities have a long way to go to improve their collection practices. Our recent Stop the Knock report highlighted the extent to which local councils are using bailiffs to collect debts. From data provided by councils through freedom of information requests, we found 2.3m debts were passed to bailiffs in 2016-17, a 14% increase on two years earlier. Of these referrals, 1.38m were for council tax arrears – an increase of 10%. |
| Councils are under enormous financial pressures to fund vital services, and recovering what they are owed is an essential part of this process. However, many are too quick to turn to bailiff action, which we know can harm the wellbeing of residents, often in vulnerable situations, and push people further into debt. | Councils are under enormous financial pressures to fund vital services, and recovering what they are owed is an essential part of this process. However, many are too quick to turn to bailiff action, which we know can harm the wellbeing of residents, often in vulnerable situations, and push people further into debt. |
| Any increase in council tax needs to be accompanied by earlier intervention and proper support for residents struggling to meet payments. Fortunately, local government is increasingly engaging with this agenda. Nearly four in 10 councils have actually reduced their use of bailiffs in the last two years, and in recent weeks more than 60 council leaders have already responded to our recommendations on how their collection practices can be improved. This is encouraging. But more needs to be done to spread best practice and ensure that councils are able to better support their residents in debt and struggling to pay. | Any increase in council tax needs to be accompanied by earlier intervention and proper support for residents struggling to meet payments. Fortunately, local government is increasingly engaging with this agenda. Nearly four in 10 councils have actually reduced their use of bailiffs in the last two years, and in recent weeks more than 60 council leaders have already responded to our recommendations on how their collection practices can be improved. This is encouraging. But more needs to be done to spread best practice and ensure that councils are able to better support their residents in debt and struggling to pay. |
| Central government, too, needs to do more. In particular, the Treasury is currently consulting on a welcome new statutory “breathing space” scheme to offer people who are seeking debt advice protections from interest, charges and enforcement action. It is essential that this scheme covers public sector creditors, such as local councils and HMRC, as well as private sector lenders. Making sure that all creditors play by the same rules is in the best interests of people in debt, who can then focus on taking the steps they need to tackle their debt problem. | Central government, too, needs to do more. In particular, the Treasury is currently consulting on a welcome new statutory “breathing space” scheme to offer people who are seeking debt advice protections from interest, charges and enforcement action. It is essential that this scheme covers public sector creditors, such as local councils and HMRC, as well as private sector lenders. Making sure that all creditors play by the same rules is in the best interests of people in debt, who can then focus on taking the steps they need to tackle their debt problem. |
| With council tax bills rising, it has never been more important to make sure residents get the support they need. | With council tax bills rising, it has never been more important to make sure residents get the support they need. |
| • Jane Tully is director of external affairs at the Money Advice Trust charity, which runs National Debtline | • Jane Tully is director of external affairs at the Money Advice Trust charity, which runs National Debtline |