In this White Paper, we examine why the collection of debt is ripe for the introduction of simple solutions which can significantly improve the financial position of authorities responsible for recovery while delivering a better service to citizens.
Local authorities are under greater financial pressure than ever before - with budgets falling by an average of 26% since 2010, and over 94% of councils currently considering increasing council tax.
At the same time, the amount of debt owed to councils has continued to rise, with the most recent estimates putting it at around £2.8bn - a significant sum which could greatly aid cash-strapped local authorities if it could be recovered.
However, approaches to debt recovery vary from area to area, with the majority of councils still relying on more traditional approaches like bailiffs. In 2016/17 over 2.3million debts were passed to collection agencies - up 14% on 14/15 - yet it is clearly not having the impact required, often simply serving to increase costs.
Of 109 councils surveyed by Esendex, 68% were unable to say whether the costs of collection exceeded the amounts recovered, and only 17% kept records of the costs of chasing late payments.
It seems that traditional solutions to debt recovery are no longer serving local authorities in the best possible way and that it is time for a step change in the way money is collected.
Giving citizens more flexible ways to pay could see fewer debts being incurred, a reduction in the stress and anxiety experienced by those with financial difficulties, a greater percentage of debts paid off, and councils spending less in the long run.