Enforcement in 2021: The new normal
Some of the changes in the pandemic for credit management and enforcement were temporary and have started to fall away, but others remain, making the enforcement landscape indelibly altered.
The first lockdown saw a moratorium on all residential judgment enforcement and landlord action.
When enforcement restarted in August 2020, the Government, Public Health England and the High Court Enforcement Officers Association (HCEOA), placed additional requirements, as part of the return to enforcement strategy.
Twelve months later, creditors have resumed issuing claims; Registry Trust Q2 data shows business judgments up by 59% and consumer judgments up by 267%.
We are working more closely with clients than ever before to understand how they want their judgments enforcing, particularly high-volume clients who had suspended enforcement last year.
New normal for creditors
We expect that enforcement agents will continue to use PPE, observe social distancing, undertake dynamic risk assessments, carry out extensive hygiene measures and regular lateral flow tests.
Identifying vulnerability and providing assistance through welfare teams is ever important, as is “breathing space”, introduced in May this year.
Enhancements to communications systems have been a priority, especially when enforcement visits were prohibited. Earlier and more intuitive communications have encouraged engagement and recovery. We have also been able to better communicate with both our clients and internally.
For judgment enforcement, visits to all properties are now permitted, unless those in residential addresses are self-isolating, however, incidences should drop with the decision that double vaccinated people without symptoms no longer need to self-isolate.
Everyone in the industry has implemented the health and safety training included in the return to enforcement strategy. At HCE Group, we also gave all staff refresher training in vulnerability and mental health awareness. Our enforcement agents now undertake visits in a more sympathetic way, which has created better engagement with debtors.
Whilst not new, pressures on the court system and County Court Bailiffs (CCB) have been exacerbated by the pandemic. Credit professionals and the enforcement industry have long been campaigning for a change to the Jurisdiction Order to allow creditors to use High Court enforcement for debts below £600. You can read the results of the HCEOA’s 2021 survey on the Jurisdiction Order.
New normal for landlords
There is also a new normal for landlords, where restrictions have lasted longer. For commercial property, the CRAR (commercial rent arrears recovery) and forfeiture moratorium are still in place to 31st March 2022, with a CCJ being an option available for recovery.
Evictions for residential property were halted until 31st May 2021 (England) and 30th June (Wales). Notice periods were extended, but reverted to pre-pandemic levels on 1st August 2021.
However, due to the pressures on the court system, there are still delays to evictions by CCBs who are struggling to meet demand. High Court enforcement has never been a more attractive option.
In conclusion
The pandemic has shown that credit management and enforcement can adapt to meet the challenges facing the public. Communications have improved with better and more sympathetic debtor engagement to produce positive outcomes.
As we move forward, the focus areas are: sympathetic approach to debtors, stronger engagement, ever vigilant focus on recovery and changes to the Jurisdiction Order to give credit professionals more options at a time when they are most needed.