By Richard Bampton, Head of Income at A2Dominion

I find that the start of the calendar year is the best time for my team to really begin to focus on the challenges for the financial year ahead. This helps with our team planning day we have in February and agreement for our objectives for 2021-22. Every organisation is different, but I think what I’ve outlined below has relevance to everyone working on income collection.

  • Income collection process – since March I’ve asked my team to make several changes to our arrears procedure and processes. Some of these have been forced upon us due to formal legal changes (see below), but there are some non-legal changes we’ve made that I think we will retain and embed permanently into our processes. It’s interesting to think that if they’d been suggested to me a year ago, I probably wouldn’t have agreed to them!
  • The gentler approach that was required when we first went into lockdown in March last year has continued to pay dividends. My team are telling me that they now have much better relationships with many of our residents than they ever had previously. Back in
    early summer 2020, I instigated my team to start ‘support calls’ with residents who we needed to contact. These are conducted by different members of the team than who would normally speak to that resident. This ‘different voice’ approach has worked well, as has
    making sure one of our tenancy sustainment officers is also on the call. This allows immediate benefit calculations/advice to be given and follow-up actions to be agreed.
  • Where there are cases that would usually reach a warrant stage, I’ve started to trial a preeviction panel. The panel includes staff from the team not involved with the case previously. They review and highlight any areas where more or new attempts at engagement can be undertaken. The resident is invited to the panel meeting and already there are positive outcomes.
  • Legal process – there have been a high number of legal changes to the possession process in the last year. I don’t know about anyone else, but at one stage they seemed to be changing every week! For 2021/22, I’m sure that many of these changes will remain in place. We may get back to seeing more possession cases being heard as we go through the year. More evictions (outside of current exemptions) may also begin to restart dependant on no lockdown and what tiers areas return to. The current changes to notice periods for NSPs could well remain in place for longer and possibly through the whole year. This will keep the onus on early intervention and the need for continued persistence by income collection teams with those residents who don’t easily engage with us.
  • Debt respite scheme (breathing space) – due to come into effect on 4 May 2021. I’m currently assessing the latest guidance, issued on 24 December (great release date). I need to work out how to record that a resident is within a ‘breathing space’ and how to
    make sure there’s then compliance with what is expected of a creditor during the ‘breathing space’. I imagine that, as with the introduction of DROs, it’ll take some time to properly understand the process and the likely volume of cases. I think, then, that the key
    is to get something simple to present to staff, and I will make sure there are a couple of ‘champions’ who can help others when needed.
    – Guidance for Money Advisors
    – Guidance for Creditors
    • Universal Credit – there continues to be plenty of media comment about the £20 per week uplift, currently due to end on 31 March. There’s also the temporary change to the self-employed minimum income floor due to end at the same time. Even if the government
    decides to extend both measures, I imagine that this will only be for a set period. There are many residents who have an agreement in place to clear their debt based on the income they receive with these changes. Without extensions, it’s going to mean a lot of contact to look again at those agreements. Good to keep pressure on MPs, especially if they’re Conservative backbenchers!
  • More debt amongst residents – StepChange are reporting a 64% increase in the numbers of people seeking debt advice in the last year. For the first time since February, the number of company insolvencies in England and Wales increased in December 2020. We have the continued increase in use of Klarna and other ‘instant credit’ companies (still currently outside of FCA regulation and credit reports for now). HMRC, VAT, and various other deferment and payment holiday schemes are all likely to end during 21/22. That’s a lot of negative news, so I’m sure that there will be more residents who have higher ‘other’ debts than ever before. This will bring additional challenges to income collection teams during the year.
    – Company Insolvencies Increase
    • More residents will need extra support – increased debt brings greater strain on households and their wellbeing. Many residents haven’t engaged with support services on offer due to Covid-19. I expect to see greater numbers likely to need these services, but at a time when the capacity of local authorities and the voluntary sector will come under even more pressure. I think that it’s important for our organisations to provide additional support where we can to residents. Where that’s not possible, our ability to know where the relevant support can be found will be invaluable. I know from experience that obtaining external funding from local authorities and/or grant providers can be a great way to provide additional specialist support for residents.