Raising Awareness of Digital Inequalities in Civil Enforcement
When we presented at LACEF this year, we wanted to present a subject that would provoke thought and analysis from the attendees. It is often taken for granted that everyone will have a mobile phone or laptop and will have access to the internet and can make phone calls.
But this may not be the case. Some people living in poverty may not have the means to contact us and their lack of contact is not indicative of them avoiding their debt problem.
So, Barry Conway and Tracy Jackson headed up our presentation that aimed to raise awareness of digital inequalities in civil enforcement.
This was the presentation they gave.
Presenting the problem
Local authorities are looking at an estimated shortfall of £509m in their council tax collections for last year and have been given until 20-23 TO 20-24 to pay this off.
On the 31st of March 2021, the total amount of council tax still outstanding amounted to £4.4 billion
As a result, the pressure is on to repair finances, whilst fairly balancing against considerations of vulnerability. Stakeholders involved in the post-Covid recovery, see the adoption of digital engagement as a key lever to a successful rebuild.
As local authorities, and the enforcement sector, enter this new era of customer engagement, propelled by the effect of the pandemic, digital service offerings to customers, also reflect an approach consistent with the changing behaviour of consumers during the lockdowns.
Accessing services online has become essential for many individuals and families. This fast-tracked, Digital Transformation, has given rise to host of new marketing technologies, channels, and virtual platforms.
Reventus, along with many Enforcement Companies & Local Authorities, have invested heavily in customising their digital infrastructures, to supercharge customer engagement. We too have formed valuable collaborations with several sponsors exhibiting here today. You’re probably familiar with a few of the following messaging channels, designed to deliver outreach to customers, across different platforms and devices:
• Email – half the population has an email account
• WhatsApp – the world’s most popular messaging App
• Mobile Push Notifications – Alerts delivered to smartphones
• SMS and MMS – text and multimedia messaging
• RCS -rich communication messaging
• Messaging Chat and Artificial Intelligence
Whilst our sector has embraced the advancement of digital technology, and contact, there are those that, for one reason or another, are excluded.
What about customers facing digital exclusion?
Digital exclusion affects a considerable number of people in the UK:
• over 5 million people do not use the internet
• 10 million have either no digital skills, or lack a key basic digital skill
• 2.6 million are offline, either due to a lack of access to a suitable device, or have no access to an internet connection
• They may have low levels of motivation to use the internet, or even distrust it
• Low literacy may also hamper their digital skills
These factors, and more, may affect our customers. In addition, those suffering financial hardship can find their freedom to use a mobile phone for calling, or using data, impacted, or they may not possess a computer, tablet or mobile phone.
With October’s cut to Universal Credit and rising energy bills this may push more households into digital exclusion.
How do we define digital poverty?
“Digital poverty is the inability to use IT, either due to the lack of access or due to the lack of skills,” said Thierry Geiger, co-editor of the Global Information Technology Report. “It is really a form of poverty because without digital access, without digital skills, you cannot tap into the huge potential of technology to improve your lives and create opportunities.”
If a customer is digitally excluded, they are increasingly excluded from opportunities. They are excluded from participating in their community, and engaging in wider issues of society, from accessing and fulfilling work online, from job hunting, and from accessing vital local services and support. Digital poverty can relate to the use of data on mobile devices whether contract or pay as you go, and the internet or broadband data packages.
When faced with debt, customers face the prospect of exclusion from the financial savings that can be gained from online access, particularly once a debt is passed for enforcement.
To unpack this a little more, it is worth examining a case study.
With the increasing drive to digital engagement in our sector, many households are being excluded and communication with them becomes increasingly difficult.
Reventus has built a reliable data foundation through our exclusive platform eTrace®, which includes access to the Vulnerability Registration Service and enhanced digital data sets from a variety of solution providers. This would usually provide us with an understanding of a customer’s situation prior to enforcement.
However, households that have no credit footprint are often found to also experience digital inequality, a credit file provides no indication that a customer may be digitally excluded.
This means that as enforcement agents, we are unlikely to have prior understanding of their digital circumstances. But what happens to customers if enforcement agents don’t know they are digitally excluded?
You will likely recognise this scenario.
Meet Ami who is currently suffering financial difficulties.
How everything changes
Everything changed for Ami when Steve left her and their two children. Unbeknown to Ami, Steve had been racking up debt for a long time, so when he left her, they owed money on all of their household bills including Council Tax. The rent was in serious arrears and an eviction soon followed.
So, Ami went from what she thought was a relatively comfortable financial situation, to being in debt and homeless along with her two children.
According to StepChange over half a million private renters have incurred £360 million of rent arrears due to the pandemic.
In April, almost one in 10 UK tenants was behind with private rent and The average amount of arrears owed had risen by 24% from £730 in November 2020 to £907 in April 2021. Citizens Advice.
From Ami's perspective
With no funds or a place to stay, Ami moved back in with her parents and in doing so relocated to a different area. However, this put a strain on the entire family, with no space for young children and limited funds between them. Following several arguments her parents gave her an ultimatum to leave and she was again homeless. Ami found herself needing assistance from the Council and emergency housing was provided to her.
She applied for Universal Credit for the first time and sometimes she struggled to feed her family.
She was unable to renew her expensive mobile phone contract that provided her with email access, social media, calls and messaging. Instead, she bought a pay as you go sim card from her local supermarket. She just needed it so she could be contacted and for emergencies. It had limited data, which she only turned on when she absolutely needed it, but the data still soon ran out. It literally was a choice between data or dinner for her young family.
According to a Statista survey, as of early 2021, 14% of respondents in the UK had a prepay/pay as you go mobile package.
Ami finally started receiving her benefits and the local authority moved her into permanent accommodation. It was a home for her and her children. She felt like everything was starting to get back to some normality and she could see the light at the end of the tunnel.
Then she had a knock on the door.
It was an Enforcement Agent. They wanted to collect monies owed for Council Tax from when she lived with Steve. They hadn’t been able to find Steve.
Ami is beside herself, she has never been in this type of situation, she doesn’t know what to do. She has nothing of any value, and she is in receipt of benefits.
She has received no letters, although with a shared postbox her mail often goes astray in the communal area. No-one had been in contact with her until this knock on the door. Now her debt has increased with enforcement costs.
Look at Ami’s situation from the enforcement perspective
The Council had tried to contact Steve and Ami and had sent letters/summons to their address whilst they were still resident without response. Subsequent letters then came back return to sender/gone away and the Landlord confirmed the family had been evicted. They were jointly named for Council Tax. Ami’s contact information of email and mobile was held on the Council Tax account.
They had tried tracing both Steve and Ami independently, but they could not find a forwarding address for either of them. After 6 months, the council were still unable to trace Steve or Ami. They had sent text messages and emails, but they were still not receiving any responses.
• Ami had ended her phone contract, so she was not receiving the text messages.
• She didn’t have data, so she was also not receiving the emails.
The Local Authority referred the account to an enforcement agent. Whilst the agent traced Ami to her new permanent address, they were unable to obtain any new digital contact information. Nothing was flagged for vulnerability.
The Notice of Enforcement by mail and subsequent compliance letter did not reach her, admittedly through no fault of her own but down to her living circumstances. Her contact details provided by the Council were used by the Agent, however having changed her number and with a new PAYG phone with no access to data for emails she missed the opportunity to act at compliance. Neither could she access her account online, to get further information about the debt, seek advice and assistance or enter a payment plan.
How digital inequality exacerbated the situation for Ami
• As a result of digital inequality - Ami failed to receive the communication from the Council before enforcement
• As a result of digital inequality - Ami failed to receive the attempts at engagement at compliance from the enforcement agent
• As a result of digital inequality - Ami’s debt increased as the first contact was when the agent visited
Data or Dinner?
So… Data or Dinner? It may come down to this for some households.
We at Reventus think it important that our sector, and stakeholders, recognise this problem to ensure that all customers who are digitally excluded, for whatever reason, are treated fairly and ethically, and not disadvantaged. But, even with the tools at our disposal, such as data segmentation and credit information, data exclusion is hard to identify.
Regrettably there is no silver bullet to resolve this issue. Albeit there are some emerging ideas, such as companies sharing their data packages, and the recycling of mobile phones.
We believe that the discussion around digital inequality is an important one, and is certainly worth addressing in the fight to lessen the impact that debt is having on vulnerable families.
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