With the introduction of the Taking Control of Goods Regulations on 6th April we are now just over two months in and are starting to see what effect these changes have had for creditors, debtors and the enforcement industry.
When it comes to the recovery of debts under these regulations, The Sheriffs Office’s core business activities are High Court Enforcement and Commercial Rent Arrears Recovery (CRAR) and so far the changes appear positive in the main.
First off, it seems that all parties approve of the new fixed fees, with the raft of complicated fees being replaced by the simple staged process. We have had feedback from both creditors and debtors to support this.
The response to the seven day ‘Notice of Enforcement’ at Compliance Stage has been lower than expected.
Early expectations were that 5% of debtors would pay in full upon receipt of the Notice but our current statistics show this figure to be nearer 1.5%. This may be a reflection of the larger sums due in High Court enforcement compared to the lower figures for items such as council tax, parking and court fines.
The good news is that there has been no negative effect to visits under the Enforcement Stages. Goods are still being taken into control (seized), prompting payments in full. Where payments in full are not obtained, debtors appear to be entering into payment arrangements more readily to avoid the potential removal of their goods and the fees charged under the Sale & Disposal stage.
Whilst, it is still early days, it would appear that recovery rates are actually up, albeit more of those are by way of a payment arrangement. Either way, this is all positive news for creditors.
We have seen a 2% increase in applications to set judgment aside. This could be due to guidance from the advice sector, but without further collection of this data over time it is difficult to tell.
The new rule regarding leaving a car clamped on the road for two hours before removal has seen some time wasted by Enforcement Agents during the enforcement process.
The only other negative for the Enforcement Agents is the amount of paperwork they now need to complete, which can, in certain circumstances, amount to a small rain forest!
We feel that so far the new regulations are working well and, more importantly, to the benefit of all involved.
As with any change there are always a few challenges to overcome, but overcome them we shall!