Tuesday, September 20, 2011

Unravelling the scam

Day eight of the siege and it's too quiet. I don't mean EU Ref Towers either, where it is easy to forget that the bailiffs could call any minute. We have to go around carefully checking that doors and windows are closed and locked – but we have to do that anyway, or the scrotes will be in.

When I say quiet, I mean out there. We've been in touch with council officials at all levels – including the chief executive – with the bailiff company Jacobs, with our ward councillor, the leader of the council, the local press, the police and even the chief constable. And, even after yesterday's effort, all we get is silence from the officials and bailiffs.

This I've met before. My feeling is that we have stopped them in their tracks. If they thought they had the upper hand, they would be all over us by now.

While the situation with the baliffs festers nicely, however, we have been powering away on the summons and liability order scam. You will recall that the legislation costs reasonably incurred by the local authority to be recovered from the debtor, to which effect charges are routinely made, usually separately for the summons and then the liability order. Sometimes, a single charge is made.

Looking at what is actually charged, though, we see an enormous variation – far more than one perhaps might have expected what is a relatively straightforward function. Let us start with Bradford MDC as a baseline, which charges £55 for the summons and £25 for the liability order, making £80 in all.

By way of comparison, we have St Albans BC, which charges respectively £50 and £48, bringing the total to £98. Then you have Canterbury, also in the south of England, which charges £50 for each document, making £100 in all. This makes an interesting contrast with Knowsley BC, which charges £45 and £15, making it one of the cheapest authorities I have found, at £60 for the job lot.

Compare and contrast, if you will, with the London Borough of Sutton, in the prosperous stockbroker belt. You will find that they want £100 for their summonses and £20 for the liability order – making the joint charge £120 – exactly double that of Knowsley.

And if you think this might be a London phenomenon, you would be wrong. Leafy Harrogate in North Yorkshire wants £75 and £41 respectively, totalling out at £116. It does not pay to be poor in Harrogate. Down in Kent, in Ashford, charges are also high, coming out the same as Sutton with £120 for the two documents. But unlike Sutton, the split is £60 for the summons and £60 for the liability order.

The impoverished Haringey LB is an oddity. It charges £125 for a summons but does not specify a charge for the liability order. There are a few like that, who seem to have a single, combined charge, which makes for another mystery.

With the variation of charges, however, there seems to be good cause to suspect that the charges levelled owe more to policy, and a decision as to what the "market" will bear, rather than any careful calculations of what these documents actually cost to produce.

Furthermore, an insight into decision-making process of LB Newham seems to confirm this, where the charge levels are set by reference to what other councils are charging. Nowhere does one actually see any attempt by officials actually to determine what the production costs are.

Moreover, councils seem to be using the charges to subsidise the debt collection effort, and as a penalty, aimed at deterring defaulters and punishing those who do not pay on time – none of which things they are allowed to do.

Then, when one council, Mid Sussex is asked for a breakdown of their £90 charge, the result is risible. Staff costs to produce two pieces of paper supposedly amount to £52, running the computer to print the pieces cost £23 and the stationery, postage and envelopes, plus information leaflet and sundry other costs, run to £15. This latter figure can be compared with the £1.70 as a unit price for a high quality commercial mailshot.

Thus, in order to get closer to what the true costs are, I have set up some detailed questions, which I am trying out with Bradford MDC, via an FOI request. I will let you know the response.

On the face of it though, we have a situation where no council has made a serious attempt to obey the law and, so far, none have been pressured to justify their charges. This, you can be assured, is about to change.