Posted July 26, 2021
The Trust’s Head of Public Affairs and Engagement Matt Hartley shares his thoughts on plans for the new Enforcement Conduct Authority, launched today in the Centre for Social Justice’s Taking Control for Good report.
Pragmatism can be painful, but powerful too. That’s never been more true in our policy work at the Money Advice Trust than it is today, as we help launch plans for the Enforcement Conduct Authority – a new independent oversight body designed to raise standards in the bailiff industry.
Reforming the way that enforcement agents (commonly known as ‘bailiffs’) collect debt has been one of our main influencing priorities for years – driven by the evidence of the harm being caused by bailiff action that colleagues at National Debtline and Business Debtline hear about day in, day out.
Our strategy has been reduce and reform – simultaneously campaigning to reduce the number of council tax and other debts being referred to bailiffs in the first place, and to reform bailiff action itself to better protect those who find themselves with a knock at the door.
In 2016 the debt advice sector came together to launch Taking Control group of charities to jointly campaign for the independent statutory regulation that we believe is needed. We have made some progress along the way – not least securing the support of the Commons Justice Committee. We’ve gathered and submitted mountains of evidence of the harm that the people our services help are experiencing – including to a call for evidence on the case for reform that, more than two years on, the Government still has not responded to.
Despite the growing consensus that better protection is needed for people in debt, late last year we came to the painful realisation that statutory regulation is very far from around the corner. Paradoxically, the impact of Covid-19 on people’s lives and finances has both strengthened our argument – and made statutory regulation even less likely, as it gets harder and harder to carve a space in the Government’s agenda as it deals with the crisis.
With this painful reality in mind, after five years of campaigning, and with harmful bailiff action taking place daily – the people we help cannot afford to wait for change.
A little pragmatism is a powerful thing
This is why – in the absence of any real prospect Government introducing statutory regulation themselves – we have been working with the Centre for Social Justice (CSJ), other debt advice charities and representatives from the bailiff industry, to explore an alternative approach. Together we have developed plans for an independent oversight body – the Enforcement Conduct Authority – which aims to secure as close to the same outcomes as possible for people in debt.
These plans, published by the CSJ today, are the product of a protracted, difficult, seven-month negotiation between the debt advice sector and enforcement industry – two groups that have rarely seen eye to eye. For years the relationship between us has been fraught, characterised by arguments over evidence and conflict – hostility, even – around the case for change.
It is no small achievement, then, that the Centre for Social Justice has been able to help the Enforcement Oversight Working Group to reach an agreement – expertly facilitated by the CSJ’s Joe Shalam – that both sides agree represents a leap forward.
What is the Enforcement Conduct Authority?
The plans for the Enforcement Conduct Authority (ECA) published today are based on best practice regulation in other sectors – and have required compromises on both sides. The new organisation will be funded by the bailiff industry, but independently governed and run.
At its core will be a ‘fairness and protection’ mandate, and a clear objective to raise standards – an important, and new, acknowledgement that the status quo is unacceptable. The ECA will adopt an approach that will be recognised by those familiar with the work of the FCA – carrying out authorisation, supervision and enforcement activity against a new set of standards. Importantly, the ECA will independently ‘host’ the second stage of a two-step complaints mechanism for the first time – a crucial fix to a very broken system.
Just as important as what the ECA is, however, is what it isn’t. The ECA is not a statutory regulator – there is no binding mandate for firms to join (although the civil enforcement trade body CIVEA will require all of its members to do so). Nor will there be, at launch, a statutory basis for the standards the ECA will set, or the sanctions it will deliver.
This is a painful compromise to make . I am encouraged, however, by the fact that for the first time, representatives of the bailiff industry have lobbied jointly with debt advice charities – during the passage of the Financial Services Bill earlier this year – for a statutory intervention in the form of ‘statutory underpinning’ for the new body.
With plans for the ECA agreed, all involved are also now agreed that some – limited – statutory underpinning is required to make the body as effective as possible in protecting people in debt from harm. Ministers have already committed to review the case for statutory underpinning ‘within two years’ of its establishment, and have been clear that this review could happen earlier. This is a commitment we will hold them to.
In the meantime, our immediate priority is to support the establishment of the ECA to ensure the body is as effective as it can be – and to ensure that implementation stays true to intention. To that end, I’m looking forward to continuing to work on this as a member of the Advisory Panel being established to support the body’s new Chair – the recruitment of which is our next, crucial, step.
Will it work?
This is the question that many will be asking today. The test, as ever, will be on the front line – whether debt advisers begin to see a reduction in the harm being caused by bailiff action that has been a feature of the problem debt landscape for far too long.
No one can truly answer this question until then. But after some pain and some pragmatism, we now have – in my view – a better chance of delivering real change for people experiencing bailiff action than we have had for almost a decade. We have to do everything we can to take it.
Matt represents the Money Advice Trust on the Enforcement Oversight Working Group. For more information on plans for the Enforcement Conduct Authority read the Centre for Social Justice’s Taking Control for Good report.
Matt is the Trust’s Head of Public Affairs and Engagement and joined the charity in 2014. He leads the Trust’s influencing work and previously worked for StepChange Debt Charity, the Personal Finance Education Group and in Parliament. View all posts from Matt Hartley.