Lambeth Corporate Income and Debt Recovery Policy

Lambeth Corporate Income and Debt Recovery Policy

This policy sets out the council s high level approach to: setting fees and charges income collection debt management payment services. The policy has been developed with reference to the Local Strategic Partnerships Sustainable Community Strategy, the council s FRESH values and the Lambeth Debt Collection Charter. In living the values the policy will embody: Fairness through robust equality impact assessments Respect for customers Excellence in value for money processes and ease of payment Service standards will be high Honesty through transparency on all aspects of income and expenditure 1. The aims of the policy Improve the efficiency of payments to local people, businesses and the council Improve income collection for the council 2. The council s commitments Set reasonable fees and charges which reflect its strategic priorities and outcomes Maximise income collection while reducing the cost of collection Write off uncollectible debt through appropriate decision making Make payments to customers by the most effective means Support indebted residents through signposting and referral to advice agencies within the borough 3. Setting fees and charges Lambeth Council is committed to setting reasonable fees and charges which reflect its strategic priorities and outcomes. The council s fees and charges are set out in Appendix J of this policy. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 2

4. Income collection Lambeth Council is committed to maximising income collection, through appropriate recovery methods, and methods of payment. With effect from the 1 st September 2012, all payments made by credit card with the exception of Parking Services, will incur a surcharge of 1.65%. This is the charge that banks make to the council for this method of payment. The council s recovery methods are set out in this policy. 5. Uncollectable debt Lambeth Council is committed to writing off uncollectable debt, subject to appropriate decision making. Please see the irrecoverable debt and bad debt provision elements of the policy. 6. Payment services Lambeth Council is committed to ensuring that all customers are paid promptly and by the most sustainable means. For example, Direct Debit and BACS will be the preferred method of payment over cash and cheque payments. Please see Appendix C for the council s Payment options strategy and policy. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 3

Lambeth Council Corporate Income and Debt Recovery Policy 2013/2014 Table of Contents 1. Introduction...6 Part 1 - Policy Introduction...11 1.1 THE PURPOSE OF THE POLICY...11 1.2 OBJECTIVES...12 1.3 THE POLICY S AIMS...13 1.4 CUSTOMER CONTACT...13 1.5 WHAT THE POLICY COVERS...14 1.6 METHODS OF PAYMENT...14 Part 2 - Policy Scope...15 2.1 ACCESS, ADVICE AND SUPPORT...15 2.2 ASSESSING ABILITY TO PAY...15 2.4 USE OF OTHER AGENCIES...20 2.6 SERVICE CHARGES...23 2.7 HOUSING BENEFIT OVERPAYMENT...23 2.8 VISITING CUSTOMERS...24 2.9 IRRECOVERABLE DEBTS...24 2.10 BAD DEBT PROVISION...25 2.11 CREDITS...25 2.12 CREDIT MEMOS...26 2.13 COMPLAINTS...26 2.14 POLICY REVIEW AND MONITORING...27 Part 3 - The policy in operation...28 3.1 WE WILL TAKE PRACTICAL STEPS TO:...28 3.2 SERVICES CUSTOMERS WILL RECEIVE...29 3.3 WHAT SERVICE WILL CUSTOMERS WITH MULTIPLE DEBTS RECEIVE?...30 3.4 PARTNERSHIP DEBT AND SERVICE LEVEL AGREEMENTS...30 Appendix A - Priority Debt...32 Appendix B - Scheme of Delegation and Financial Regulations...34 Appendix C Payment Options Strategy and Policy...36 Appendix D - Request for Financial information...40 Appendix E - Vulnerable Persons Policy...41 Introduction...41 Vulnerable adult definition...42 Identification...43 When to apply the vulnerable person message codes...44 What to do when a person is considered vulnerable...44 Debt management...45 Appendix F - Advice centres in Lambeth...46 Operational matters - Questions to ask...46 ACADEMY...47 Home visits...48 Appendix G - Hardship Relief for NNDR Payers Introduction...50 HARDSHIP RELIEF FOR NNDR PAYERS...50 Background...50 RULES TO BE ADOPTED FOR THE CONSIDERATION OF HARDSHIP CASES...51 CRITERIA...52 Hardship Relief for Rent Payers Policy...53 1.0 INTRODUCTION...53 Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 4

2.0 WHAT TO DO WITH CLAIMS IDENTIFIED FROM 21.06.04...53 3.0 SENDING OUT DHP FORMS...53 4.0 DHP APPEALS...54 Appendix H - London Borough of Lambeth Financial Shared Services & Partners Service Level Agreement...55 1.0 INTRODUCTION...55 1.1 Overview...55 2 THE AGREEMENT...55 2.1 Statement of Intent...55 2.2 Partnership Principles...55 3. FINANCIAL SHARED SERVICES...56 3.1 Service Offering Activity by Service Line...56 3.2 Hours of Operation...57 4. PARTNERS ACCOUNTS PAYABLE TEAMS...57 Appendix I - Protocol for Payment of Business Rates and Council Tax for Council Owned Property...58 INTRODUCTION:...58 Appendix J - Sundry Debtors Scale of Charges & Fees...59 Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 5

1. Introduction For Lambeth Council, responsible financial management is critical to enabling the delivery of over 600 services efficiently, effectively and sustainably. Lambeth Council s Corporate Income and Debt Recovery Policy focuses on two essential elements of sound financial management, income collection and debt management. The driving principle behind the policy is to maximise income collection by the most fair and effective means. The council s Corporate Income and Debt Recovery Policy spans all aspects of the council s income and debt activity. The policy sets out the principles that the council and its partners will use in setting and collecting all charges, as well as the standards that will universally be applied when dealing with our customers. In approaching corporate income and debt recovery at a corporate level we will be able to analyse trends across service areas and inform the council if our customers need further financial support. For example, as changes in the disability living allowance are enacted the council will be able to analyse if there is a significant increase in disabled people in debt to the council, similarly we will be able to analyse if there are changes in the amount of people not in debt as a result of the welfare reforms. The council endeavour s to collect all monies owed, at the same time our recovery procedures will be sensitive to individual circumstances. In particular, we will: set out our charges clearly be fair and consistent in dealing with all our customers seek to prevent enforcement by offering accessible payment options, advice and assistance at an early stage where necessary, ensure that action taken at the later stages of the recovery process is proportionate and that appropriate advice is provided. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 6

This policy will be reviewed annually to ensure that it meets the needs of the council, its partners, businesses and residents. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 7

Council income targets As part of the council s annual service and financial planning process, all income streams, collection rates and the associated bad debt provision are reviewed. Table 2.1 below illustrates the 2013/14 collection targets. Performance against these targets is managed by the respective departments (for example, council tax collection by Finance and Resources and parking income by Housing, Regeneration and Environment). Table 2.1 Council income targets 2013/14 Income stream 2013/14 debt raised 2013/14 collection target Council tax 119.2m 95.0% NNDR 126.7m 98.2% HB overpayments 7.5m 70.0% Sundry Debt 78.0m 94.0% Parking PCNs 15.4m 65.0% Rent 158.0m Includes all tenant income In year collection: 100% BV66a: 96.26% Total Former arrears 7.2m Section 20 0.5m No collection target Council tax arrears 31.4m To reduce balance by 2.1m Temporary accommodation 17.3m 98.0% Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 8

The executive ownership for income collection is held by the Senior Leadership Board (SLB) and is devolved across the council as outlined in Diagram 2.1. The policy will be monitored annually by RBCS DMT Diagram 2.1 Income collection responsibility Council Finances Housing Revenue Account General Fund HRE Council Rent Leaseholder Service Charge F&R Council Tax Benefit Overpayments NNDR Sundry debt (FSS) HRE Parking Permits Parking Penalties Section 20 Not all departments are listed in Diagram 2.1, this is due to all sundry debt income collection being centralised to the Finance Shared Services in Finance and Resources, who collect debt on the department s behalf. The council also commissions a number of partners to collect income on its behalf, these are: Capita Council Tax, NNDR and telephone FSS debt NCP Penalty Charge Notices Lambeth Living Rents, Section 20, Leaseholders United Residents Housing Rents Although the responsibility for income collection is devolved across the council there is a hybrid model in place for each of the main income streams bad debt provision, which includes budgeted amounts at a local level, as well as a corporately held bad debt provision. The reason for this is that each department has it s collection targets and therefore it s own bad debt Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 9

provision A clear outcome for this policy is to, over time, reduce the requirement for the current levels of bad debt provision. This policy has been developed to help meet the council s corporate debt recovery priorities, particularly in respect of residents who have multiple debts across the council. The aim is to reduce amounts owed to the council whilst ensuring that residents are supported to address their debt and pay back any monies owed. In order to ensure that we are following best practice in achieving responsible debt collection, we have obtained feedback form external agencies such as the Lambeth Citizen Advice Bureau, local authority peers and internal teams, such as the Every Counts Campaign in Adults and Community Services. The policy is in three parts, covering: the aim and objectives of the policy scope of the policy the policy in operation The policy will be monitored monthly by Finance Strategy Board and subject to an annual review at SLB and RBCS DMT. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 10

Part 1 - Policy Introduction 1.1 The purpose of the policy 1.1.1 Lambeth Council is required to collect monies from both its citizens and businesses for a variety of reasons. A high percentage of debt owed to the council comes from multiple debtors who owe council rent, council tax and housing benefit overpayments. 1.1.2 In undertaking this collection function it is inevitable that the council will be required to pursue the recovery of arrears from persons and / or businesses that may experience difficulty in paying such accounts. Therefore, an agreed policy of how the council manages and collects debts is key to ensure consistency and best practice in such situations. 1.1.3 This policy identifies where responsibility for collection of different debts lies, and sets out the principles and standards in relation to contact, recovery processes, repayments and benefit / money advice. Integral to the policy is the provision of support mechanisms and practices to all customers. It details the approach to collecting debt in Lambeth Council and also explains how the council can offer practical help, advice and support in the management of debt for our customers. 1.1.4 The policy sets the framework for a consistent and sensitive approach to collecting debt whilst at the same time ensuring that the council continues to maximise income collection. Lambeth has one of the highest levels of deprivation in London and we have created a holistic approach to debt recovery to take this into account. 1.1.5 In managing its income the council s over-riding priority must be to ensure that the amounts due to the council are collected in a consistent and efficient manner, and that Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 11

there is no build up of arrears. To guarantee that this happens the council must, amongst other things, check that: there are agreed triggers in place to provide an opportunity for early intervention to reduce the likelihood of the arrears growing larger the debt is indeed due and is raised correctly and timely the debtor is given a clearly itemised invoice setting out the charge, the basis of the charge, methods of payment and council contact details there is a clear recovery process which is understood and implemented fairly and consistently by the council and its partners appropriate advice and support is given where necessary. 1.1.6 This policy covers all debts owed to the council, including: council tax rents, both housing and others, e.g. garages and commercial benefit overpayments business rates sundry debts inc. residential and non-residential debts, unpaid fees and charges, etc legal costs penalty charge notices (parking contraventions) Section 20. Commercial waste and street traders. 1.1.7 Appendix A summarises the types and priority of debt covered by this policy. 1.2 Objectives 1.2.1 This policy will apply to all council departments. The policy does not favour legal action over providing support to our customers, as each department needs to ensure that its regulations and recovery policies are followed. 1.2.2 It seeks to be fair but firm and the full range of collection and recovery methods will be used as appropriate if debts are not paid. The policy operates within the framework of relevant legislation (for example. on data protection, human rights, reasonable adjustments for accessibility) and best practice from our previous departmental income and debt recovery policies. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 12

1.3 The policy s aims 1.3.1 The policy aims to: maximise income for the council, including rent income due to the housing rent account for domestic council properties ensure that all council tax and rent payers interests are protected by striving to collect debts achieve an equitable share of income available to pay across all council and rent debts depending on recovery processes in place achieve efficiency savings by identifying solutions for customers on debt issues at the first point of contact this is being achieved as this year the contact centre have been given access to agree payment arrangements where customer s are unable to pay an invoice in full be fair but firm be preventative, for example offering payment options (Appendix C) and other advice help, where possible, to maximise customer s income advise customers of reputable advice and support agencies (see Appendix F) ensure consistency in dealing with customers apply best practice in relation to debt collection Refer potential candidates to Every Pound Counts to ensure maximum welfare benefit entitlement is taken up. 1.4 Customer contact 1.4.1 We will strive to improve contact with customers by: encouraging the customer to make early contact in respect of debt related matters using plain English in written letters and documents ensuring relevant legislation is followed promoting advice and support services providing communication assistance when needed e.g. translation / interpreting services for telephone, face-to-face or written communications providing one form that details all financial information sufficient for all departments debt to be considered with regards to priority debts. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 13

proactively contacting residents/customers when arrears triggers are reached to identify opportunities to provide support and reduce the likelihood of residents getting into further debt. 1.5 What the policy covers 1.5.1 The policy covers the following: how customers and residents can access advice and support how ability to pay will be assessed once supporting documentation has been received how information may be shared how the council uses collection and other external agencies how we will conduct personal visits to debtors how we will deal with irrecoverable debts alongside our Debt write off policy (please see Appendix B) corporate approach for dealing with customer credits how customers can access the council s corporate complaints procedure. Details for each of these areas is covered in part two of this document 1.6 Methods of payment 1.6.1 The council offers a range of accessible payment methods, including Direct Debit, Standing Orders, internet payments, cash and cheques.. The council s preferred method of payment is Direct Debit. 1.6.2 In addition, a number of electronic methods such as online payments via the council s website and mobile phone technology are available. Appendix C explains the different payment methods and how they might be more appropriate depending on the type of debt owed and individual circumstances. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 14

Part 2 - Policy Scope 2.1 Access, advice and support 2.1.1 The council will advise individuals / businesses as to the range of discounts, reliefs and reductions available at both the time an account is issued and in subsequent communications. This information is also available on the council s website. 2.1.2 Staff in direct contact with customers will signpost them as to where they can obtain advice on benefits and debt matters appropriate to their needs. 2.1.2 We will ensure that all written communications use language appropriate to the intended recipient and that plain English is the standard wherever possible. We will explain complex terminology when it is required to be used by law. All documents will be issued in a timely manner, in accordance with any statutory timescales. The legal options open to the council in collecting debts and the customer in paying debts will be explained, taking into account the stage of recovery achieved. 2.1.3 We will assist people with language and communication difficulties, by offering translation, interpreting and other services when required. This will be delivered through staff following the council s translation and interpretation policy and procedure. 2.2 Assessing ability to pay 2.2.1 In pursuing debt recovery, the council will act in accordance with statutory regulations and guidance. It s imperative that the council s approach to debt recovery is responsible and responds to the financial and social vulnerability of residents. It is also important that any Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 15

assessment to pay is attuned to the possibility that customers may have illegal money arrangements (such as loan sharks and doorstep lenders). 2.2.2 The council will be flexible in its expectations by taking into account the individual s circumstances and the financial climate that we are operating in. 2.2.3 In terms of efficacy, experience shows that as a general rule, collection is maximised by pursuing debts on an individual basis in a timely manner. Different recovery legislation in relation to council tax, housing rents, sundry income etc, tends to support this approach. 2.2.4 Where it is apparent that a customer is unable to pay an account/s, then the aim will be to agree an arrangement to pay (where appropriate), which takes into consideration the specific circumstances of the customer. 2.2.5 A customer s ability to pay will be based on the households disposable income in proportion to the level of debt, the extent of debts owed to the council and that council tax and rent arrears are equal priority debts. The initial intention of arrangements to pay will be to clear the debt(s) as soon as possible. As a rule of thumb, the minimum position is that any debt should not increase. Pre-charge registration Penalty Charge Notices (parking contraventions) on their own are excluded from the arrangement process. 2.2.6 In practice this means ensuring that the current or most recent account is cleared, whilst making the maximum contribution to clearing other debts. Staff will always seek to make realistic arrangements to clear outstanding amounts by regular payments, in preference to taking legal action for recovery. Any arrangement agreed will be monitored on a monthly or weekly basis, depending on the payment terms of such arrangement. 2.2.7 A financial statement and supporting documents may be required to support a request for an arrangement. This will be a list of the customers household income and expenditure. 2.2.8 A financial statement can be completed with the help of an independent agency such as the Citizens Advice Bureau or online (see Appendix D). Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 16

2.2.9 Persons in single and multiple arrears will be offered the opportunity of independent debt advice. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 17

2.3 Information Provision of information: In addition to detailing the amount payable and a description of the charge, the council will include the following information on all accounts: (a) the payment options available (b) a contact number for queries in relation to the accuracy of the account (c) a contact number for discussing payment arrangements where the customer has difficulty in paying the amount requested on the account (excludes Parking Penalty Charge Notices). 2.3.1 Wherever possible the contact number in (b) and (c) is the same. 2.3.2 Where it is necessary to issue recovery documentation (e.g. a reminder or summons) following non-payment of an initial account, or because an instalment arrangement has not been adhered to, then the council will include the information detailed above on such communications. Some services are also sending reminder notices via e-mail and SMS text messaging. This has reduced the amount of paper reminders issued which saves the council postage and printing costs, we will look this year to roll out to other areas. 2.3.3 In line with the council s translation and interpretation policy and procedure, we will provide information to meet specific communication needs. Arrangements will be put in place to use accredited language translators / interpreters to assist persons who have difficulties communicating in English, or British Sign Language (BSL) interpreters for those who have hearing impairments. 2.3.4 In meeting individual needs the council will, where practical, ensure that individual preferences are documented so that ongoing and future correspondence can be delivered in the preferred format, whilst still adhering to any relevant legislation. 2.3.5 To develop pre-payment for services as the default position. To progress a strategy of prepayment for chargeable council services, however this will not be applied for statutory services such as adult care services. To increase the collection performance for Commercial Waste customers, in 2013/14 contracts will be reviewed with a view that customer s pay for their service in advance, if payment is not received then collection will Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 18

not be undertaken and the applicable penalty will be applied to the business. Also, the NNDR database is also being checked prior to setting up and agreeing any contract so the legal name is used, this will enhance and improve the recovery process. 2.3.6 FSS Aged Debt profile has been reviewed and a strategy to further improve the collection rate is being put in place. FSS will work in partnership with a specialist public sector debt collection agent, this will enable FSS back office staff to concentrate on collecting in year debt. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 19

Sharing of information: 2.3.7 The council will ensure that all computer systems used to bill and recover monies satisfy statutory requirements and offer the full range of recovery options to be pursued and are audited regularly. 2.3.8 Staff involved in the collection and recovery of accounts will be given appropriate training in: processes for collecting debt and income recovery the use of all applicable computer systems interacting and supporting vulnerable people the translation and interpretation procedure. 2.3.9 Subject to any limitations imposed by the Data Protection Act (1998) and the Human Rights Act (1998), access to debtors information contained on different systems will be made available to key staff in order that an individual s full indebtedness can be established and properly dealt with. 2.3.10 In order to be successful and ensure consistency, it is necessary to establish good working practices across council departments, statutory and voluntary agencies and all service providers when dealing with debtors. 2.4 Use of other agencies 2.4.1 Lambeth Council, on successfully taking court action against a debtor, is empowered to enforce payment through a number of statutory remedies, including powers which impact on a person s possessions or liberty e.g. the right to seize goods, to evict a tenant, to request imprisonment, apply for a Charging Order etc, and will apply the most appropriate remedy. 2.4.2 One of the remedies is Levy of Distress, which Lambeth Council exercises through the use of external bailiff agencies. 2.4.3 To ensure effective, consistent and appropriate application of the Levy of Distress, Lambeth Council s appointment of bailiff services is through contractual agreement, including a detailed code of conduct which the bailiffs must follow. This can be found on Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 20

the Department of Constitutional Affairs website at: www.dca.gov.uk/enforcement/agents02.htm#part3 Bailiff costs are also monitored by the Revenues client team on a monthly basis. 2.4.4 The council will ensure that these more 'severe' powers, for example removal of goods, will only be used when all other reasonable methods have failed and where all appropriate internal and statutory processes have been properly followed. 2.4.5 In the case of sundry debtors, unpaid accounts will be referred to our contracted solicitors who will seek judgment in the County Court, and apply the appropriate remedy to recover the debt. The options available include Attachment of Earnings, Charges on Property or referral to a High Court Enforcement Officer. 2.4.6 Debts relating to Adult and Community Services (ACS) residential care clients may be subject to Charges on Property under the Health & Social Services and Social Security Adjudications Act 1983 or under the Deferred Payments Scheme. 2.4.7 Charging orders are another form of recovery that will be considered when pursing debt and if it is considered the best way to secure the debt for the council it will be used. 2.4.8 The use of charging orders is also closely linked to the vulnerable person policy (Appendix E), which identifies cases where it is considered that the debtor is vulnerable and so a charge on the property is the best way for the council to secure the debt. 2.4.9 Charging Orders in the Adults and Community Services (ACS) department fall into two categories: a) HASSASSA Charge s.22 of the Health & Social Services and Social Security Adjudications Act 1983 gives a local authority the power to obtain a charge over a person s interest in land and can be exercised against those persons who avail themselves of accommodation provided by the local authority under Part III of the National Assistance Act 1948. i.e. Residential Care. The charge is therefore one, which will be obtained by the local authority where the person has fallen into arrears of their accommodation charges. b) Deferred Charge s.55 of the Health and Social Act 2001 deals with a local authorities power to take charges on land instead of contributions. A deferred payment arrangement Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 21

is an agreement by which the local authority agrees to defer payment for Part 3 accommodation for a specified period. In exchange the resident grants the authority a charge over land. A charge created under s.55 is different to the HASSASSA charge because the resident must expressly grant the charge. 2.4.10 Charging Orders for other services can fall into a third category: c) Ordinary Charging Orders (including the use for Council Tax) This is where judgment has already been entered (such as obtaining a liability order for non payment of Council Tax) and the debt is secured against property by way of a Charge. If the debt remains unpaid, further enforcement is actioned and an Order for Sale can be granted by the court. This course of action is only taken as a last resort and approval would be obtained from the relevant Head of Service. The use of Bankruptcy is also used for Council Tax and NNDR persistent debtors 2.4.11 Guidance will be sought in all cases from our contracted solicitors. At this late stage of the recovery process substantial costs may be incurred (see Appendix J). 2.5 Penalty Charge Notices (parking contraventions) 2.5.1 Penalty Charge Notices, pre-county court charge registration, are excluded from this policy's arrangement process. Only post charge registration cases may be considered in any arrangement process, providing severe financial hardship is identified as a result of the parking debt adding to other council debts. Such consideration would normally be through partner advice agencies or the multiple debt referral process. 2.5.2 Penalty Charge Notices which have accrued due to non-payment or multiple tickets, but which do not contribute to other council debts are not included in this policy. However, in cases of financial hardship it may be possible to offer arrangements to discharge the debt over a period of six months or less. Parking Service s must be contacted directly to arrange this. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 22

2.6 Service charges 2.6.1 Leaseholders are obliged under the terms of their lease agreements to pay their service charges monthly in advance by the first day of each month. 2.6.2 In March each year, Home Ownership Services send details of the new estimated annual service charge for the new financial year to each account holder. Our financial year runs from 1 April to 31 March. Ground rent is added to the account on the 1 April each year and is payable in full at this time. Usually the new annual estimate results in an increase of the monthly service charge. We ask each account holder to adjust their monthly payment so that the new payment reaches the service charge account by the 1 April. To ensure that this runs more smoothly a standing order form is sent with the covering letter. 2.6.3 Ground rent is charged to leasehold properties only and is due for payment on the 1 April each year. 2.6.4 At the end of the financial year, we prepare our final accounts to show what we have actually spent in the previous year. Generally about six months after the end of the financial year Home Ownership Services apply the final accounts to each service charge account. If the estimated charge was too low we make an adjustment adding the difference to the service charge account. If the estimated charge was too high we make a credit adjustment of the difference to the service charge account. 2.6.5 For account holders whose account was in arrears before applying the final account, the council should continue with the arrears action. The situation may have become worse due to adding a debit adjustment to the account because of the final account. 2.7 Housing benefit overpayment 2.7.1 An overpayment of housing benefit (HB) is any amount which has been paid but to which there was no entitlement. This includes any amount of rent rebate or rent allowance paid in excess of entitlement, rent allowance paid on account, which is in excess of entitlement and rent rebate credited to a rent account in advance of entitlement. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 23

2.7.2 Most overpayments are recoverable, regardless of the cause of the overpayment. The only exceptions to this are certain official errors. Any recoverable overpayment may be recovered at the council s discretion. If you establish an overpayment is recoverable, it does not mean you must recover it. The decision that an overpayment is recoverable must be separate from the decision to recover it. Due regard should be given to the circumstances relating to individual cases, when deciding whether or not recovery is appropriate. 2.7.3 The decision of who to recover from differs depending on which regulations were in force at the time of the overpayment decision. The regulations were amended with effect from 10 April 2006. 2.8 Visiting customers 2.8.1 The council, or contracted external debt recovery and enforcement agents, may undertake visits to persons or businesses in arrears in order to resolve accounts outstanding. 2.8.2 All staff or third parties making such visits will act in accordance with an agreed code of conduct. 2.8.3 The council will make every effort where possible to co-ordinate visits to debtors so that where appropriate, different debts owed by the same individual or business can be addressed at the same time, including liaison with HMCS. 2.9 Irrecoverable debts 2.9.1 The council recognises that not all debts are collectable and therefore it will be appropriate in certain circumstances to classify debts as irrecoverable, where predetermined criteria are met (see Appendix B). 2.9.2 The council will ensure that there are guidelines and policies in place which detail the action to be taken prior to an account being written-off. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 24

2.9.3 The Client Team receive a free weekly Debtors report from PWC that detail bankruptcy, DRO and IVA that have been granted on Lambeth residents, this is shared corporately so that all council debt can be included in our proof of debt. 2.10 Bad debt provision 2.10.1 A bad debt is an outstanding sum of money owed to Lambeth Council that has not been paid, despite repeated efforts to collect the debt. All recovery avenues must be exhausted before a debt is classified as uncollectible. The provision is the total of all the accounts where it is unlikely that we will recover the debt. 2.10.2 When it is established that the debt is irrecoverable or uneconomic to pursue further, the debt will be recommended for write off. Where the client is deceased and there is no estate for the council to pursue for monies owed to the council, the debt will be recommended for write off. 2.10.3 However, even where we have written off debts as irrecoverable, Lambeth Council will reinstate debts and attempt to collect them if new information becomes available, for example, if we manage to get a current address for a debtor whose whereabouts were previously unknown. 2.10.4 The Divisional Director s of Services together will approve write-off of bad debts (see Appendix B for authorisation details). With that authorisation, the debt can then be written off against the provision for bad debt that had been built up over time. 2.10.5 When debt is written off we will signpost the customer to advice agencies and other relevant support in an effort to ensure that they do not find themselves in a similar position again. 2.11 Credits 2.11.1 Lambeth Council will develop a corporate approach to refunding credits, in that where ever possible, checks will be made for other outstanding debts to the customer, prior to a refund being made. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 25

2.11.2 Where other debts are identified, it may be necessary to obtain the customer s permission, prior to a credit transfer. Other credit refunds, for example compulsory purchase compensation and home loss payments, are included in this policy s approach. 2.11.3 All departments must strive to reduce then cease all cheque refunds by 1 April 2012 refund applications have been amended to reflect this. 2.11.3.1 Council Tax and NNDR also SMS reminders for unclaimed credits although this has not had a significant uptake, if this changes we will look to roll this out to other services. 2.12 Credit memos 2.12.1 Where an invoice has been set up for a verifiable service according to standing procedures and on the basis that all avenues for recovery have been exhausted, then the debt will be written off against the bad debt provision on the balance sheet. 2.12.2 However, if the debt has been raised erroneously, it is not appropriate that the debt is written off a credit memo must be raised so that the cost is charged back to the business unit. Where it identifies cases where this applies, the FSS credit and collections team will inform the business unit manager that a credit memo is required instead of a write-off request. If there is no response by way of back up documentation within 21 days, then the FSS Billing & Collections team will seek authorisation from the Divisional Director of Revenues Benefits & Customer Services to raise the necessary credit memo instead of the write-off. 2.13 Complaints 2.13.1 The council will endeavour to resolve problems in relation to debt collection at an early stage, in an informal manner. 2.13.2 Where this is not possible, debtors will be advised of the corporate complaints procedure, should they wish to take the matter further. What procedures will be used? Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 26

2.13.3 Lambeth Council will develop a consistent first contact procedure in respect of information given to customers making a debt enquiry. All customers will be informed of the options available to manage their debt(s) and of the relevant service providers who may be able to offer assistance. 2.13.4 The structures, points of contact, interdependencies, communication and information sharing protocols will be developed and shared with service providers and customers. 2.14 Policy review and monitoring 2.14.1 The policy and its effectiveness will be monitored. This will be carried out by the RBCS DMT which will meet quarterly to discuss any problems and issues that have resulted from the policy. 2.14.2 The policy will be reviewed annually by the Strategic Leadership Board. This will enable it to be updated where necessary and take account of changes in legislation. 2.14.3 New approaches and ways of working will inevitably be introduced and this policy will need to be adapted to take these into account. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 27

Part 3 - The policy in operation 3.1 We will take practical steps to: raise awareness of debt with customers identify how much / how it has occurred raise awareness of the implications of non-payment. For those who can pay, the council will: provide information on how to pay by advising on methods, payment frequencies and at which locations people can pay (see Appendix C) encourage automated payment methods wherever possible, Direct Debit being the most cost efficient option make arrangements for the payment of accounts outside of traditional office hours and through the internet and touchtone technology, 24 hours a day, seven days a week wherever practical, request payments in advance so as to maximise cash flow and to minimise the necessity to issue accounts requiring collection, which in turn will minimise the opportunities for debt to arise make available the use of online billing and electronic forms undertake credit checks for the provision of some services. For those who can not pay, the council will: advise what happens if debts are not paid inform who can give help / advice (see Appendix F) encourage people to get help from a range of sources make referrals to appropriate agencies consider writing off all or part of the debt (see Appendix B). Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 28

Our approach will be: A supportive approach to debt recovery with a pro-active referral process where possible. We will deliver a service which meets the needs of each individual and signpost to other support agencies. Whilst the council will ensure that arrears are pursued in a timely manner, it does recognise that certain individuals will require more sympathetic and sensitive treatment, for example in the case of recent bereavement, major illness or where the customer requires special assistance in handling their financial affairs. In the case of a vulnerable person refer to the Vulnerable person policy (see Appendix E). Consideration may be given in certain cases of hardship for the customer s debt to be remitted (see Appendix F). 3.2 Services customers will receive 3.2.1 In determining how customers can best be supported and encouraged to address debt issues, it is important that service provision at the first point of contact is delivered in a sensitive way, to: establish the overall aims of the council in placing the customer at the heart of all we do; with focus on external customers set out a specific direction for the development of customer access channels, regardless of department or service provide a framework for customer service improvement, based upon clear and agreed principles. 3.2.2 Once a customer has made contact it is imperative that they are referred on to the most appropriate source of debt management support. 3.2.3 On initial contact with Lambeth Council, customers will be informed of the options available to manage their debt(s) and of the relevant service provider. Where appropriate, customers will be informed of debt advice and support services available to them outside the council. 3.2.4 Customers with a single debt to the council, where the debt cannot be cleared, a realistic agreement to pay, will be agreed with the relevant department. If the service falls under FSS, the call centre agent answering the call is empowered to make an Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 29

arrangement with the customer within the guidelines quoted in their workbooks, if the customer requires a longer arrangement outside of the normal procedure, an RFFI Form will be completed by the agent with the customer and forwarded to the service for consideration via Oneserve. 3.3 What service will customers with multiple debts receive? 3.3.1 It is important that officers know the full extent of the customer s debt when arranging payment plans and referrals. Customers presenting with multiple debts should be actively encouraged to share with staff, information on all monies owed. 3.3.2 This policy does not promote a one size fits all approach, but rather looks to work with the customer to take agreed steps to help address multiple debts. 3.3.3 To this end, the response to debt management will vary as different solutions will be needed to address the far ranging complexity of cases. 3.3.4 The provision of individual responses will also take into account diversity and exclusion issues. 3.3.5 Support will be offered, including access to interpreters for customers whose first language is not English or for those who are deaf, ensuring staff attending appointments are able to address the individual customer s needs. Where requested the provision of supporting information for customers will be made available in an appropriate format, e.g. large print, Braille or audio. 3.3.6 Where practical, we will also require our partners and suppliers of services to ensure the same level of service is provided and encourage other agencies to mirror our approach to diversity and inclusion issues. 3.4 Partnership debt and service level agreements 3.4.1 Lambeth Council has a number of partners that are regularly invoiced for services provided. These include Lambeth Living, Primary Care Trusts, central government departments, public utilities and other local authorities. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 30

3.4.2 A number of our partners are also suppliers of services to Lambeth and this forms an ideal opportunity for a service level agreement to be made to formally manage receipts and payments respectively. 3.4.3 The service level agreement should ensure that the supplier receives payment on time and Lambeth will expect a reciprocal arrangement with monies due to the authority. 3.4.4 The service level agreement is attached at Appendix H. A protocol for the internal collection of business rates is also included at Appendix I. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 31

Appendix A - Priority Debt Priority debt There are many types of debt, but those considered as priority debts are those debts owed to creditors who can take the strongest legal action against an individual who does not pay. It is not the value of a debt that makes it priority but what creditors can do to recover their money. The procedures supporting this policy would ensure customer awareness of what priority debts are. The policy identified the following as equal priority debts: Rent arrears as it can result in eviction Council tax as it can result in bailiff action, attachment of earnings / benefits, bankruptcy or imprisonment Business rates as it can result in bailiff action, bankruptcy or imprisonment Housing benefit overpayments as it can result in County Court Action Sundry debt as it can result in County Court action and a High Court Enforcement Officer Service charges as it can result in repossession Other priority debts Fuel debts as they can result in disconnection Income Tax and VAT as they can result in bankruptcy or imprisonment County Court Judgements - can result in bailiff action, Attachment of Earnings or bankruptcy Fines or compensation / costs orders as they can result in imprisonment Maintenance / child support as it can result in repossession of goods or even imprisonment Hire purchase will be considered essential if, for example it is for the purchase of a car needed to get the owner to work. Water rates as it can result in bailiff action / disconnection Maintenance or child support as it can result in bailiff action or imprisonment Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 32

Penalty Charge Notices (parking contraventions)- can result in bailiff actions and the vehicle impounded Mortgage arrears The following are considered non-priority debts credit/store cards unsecured personal loans bank overdrafts credit / interest free / hire purchase agreements catalogue debts money borrowed from family and friends. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 33

Appendix B - Scheme of Delegation and Financial Regulations Part 3 - Section 4 Scheme of delegation and financial regulations Introduction The Constitution of the London Borough of Lambeth sets out how the council operates, how decisions are made and the procedures followed to ensure that these decisions are efficient, transparent and accountable to local people. The Constitution is made up of 16 Articles with detailed procedures and codes of practice included in supporting rules and protocols. The council has a statutory duty under s151 of the Local Government Act 1972 to make arrangements for the proper administration of (our) financial affairs and secure that one of (our) officers has responsibility for the administration of those affairs. Accordingly, the Scheme of Delegation Part 3, Section 4 Part A provides information and guidance to council officers and others on the various levels of delegated authorities that are exercised by the council in carrying out its statutory functions. They are to be read in conjunction with such other council wide procedures and related documentation as may be necessary and particular attention should be made to any financial requirements that are mentioned. The Scheme of Delegation consists of three distinct categories: (a) the Introduction; (b) the Corporate Scheme of Delegation, which applies to the Chief Executive and all Executive Directors; and (c) additional powers which have been delegated individually to the Chief Executive and each Executive Director. Financial Regulations Part 3, Section 4 Part B form a fundamental part of the working of the council and can be found following the Scheme of Delegation. 7 May 2008 Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 34

CORPORATE SCHEME OF DELEGATION 16. All officers making decisions under delegated powers are required to keep a register of all such decisions. Debt write-offs 36. Authority to write off debts is delegated to officers in accordance with the following scheme: Value of debt Over 100,000 More than 10,000 up to and including 100,000 Up to and including 10,000 Authorising Officer Executive Director and the Executive Director of Finance and Resources Executive Director and Divisional Director of Resources Divisional Director and Divisional Director of Resources Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 35

Appendix C Payment Options Strategy and Policy 1.1 In the year 2012/2013 year, the council processed approximately 1.1m payment transactions with a total value of 347m, as follows: Service Value (,000s) Value % Volume Volume% Council Tax 112,475 0.32 384,736 0.34 Sundry Debt 81,684 0.24 38,228 0.03 Business Rates 75,379 0.22 18,331 0.02 Housing Rents 75,369 0.22 663,179 0.59 Housing Benefit 1,706 0.00 9,366 0.01 Overpayments Commercial Waste 397 0.00 2,733 0.00 Highways Parking 156 0.00 1,868 0.00 Housing Parking 22 0.00 867 0.00 House Purchase 2 0.00 14 0.00 Easy Mobile Devices 2 0.00 91 0.00 347,192 1,119,413 1.2 In view of the volume of transactions and the need to safeguard services for residents, the council has recently re-assessed its methods of payment in order to inform a strategy for the future. 2 Objectives 2.1 The strategy has four objectives, as follows: 1. Revenue collection Payment methods should encourage the individual or organisation to pay promptly or require payment to a pre-determined timetable. 2. Value for money Minimising the cost of processing each payment. Reducing the need for staff to intervene in the process. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 36

3. System integration Ensure that, where possible, payments are processed through the Council s own systems or there is an automatic upload to those systems. Reduce the number of steps staff must take to process each payment. Simplify the options for the customer to make payments. 4. Convenience and choice Ensure that the payment methods available serve the needs of the customer while reducing the cost to the council. 3. Current payment methods cash 3.2 The council maintains a cashiers office at Olive Morris House. Cash is the traditional payment method requiring face-to-face contact with a cashier either at the council s cashiers or a bank. This method is, however, quite labour-intensive and expensive to operate. Queues at busy times may not suit all customers. The cashiering function was automated in the third quarter of 2011/2012, there are now three payment kiosks which has seen a decrease in the footfall, but collection has been maintained. 3.3 The council is introducing new, secure and efficient methods of payment, and it is anticipated that over time the use of cash will decline and cease to be a major method of payment. Cheque / Postal Order 3.4 This is normally used for large transactions and payments made by post. As with cash above, the council is introducing a number of new payment methods which residents should find to be secure and convenient. Direct debit 3.5 The council promotes direct debit as its preferred payment method. This is an automated transaction initiated by the council to a fixed timetable. The customer Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 37

completes a mandate authorising the council to request payment for the service from a nominated bank account. Some services have self service for Direct Debit, where the resident can set this up themselves. 3.6 Direct debit is the simplest and most convenient way for our customers to pay their bill, saving them time as their bills are paid automatically. Customers can choose when in the month the payment is made giving them greater control over their money. 3.7 Direct debit is the preferred payment method as there are benefits to both the customer and to the council. These benefits include: the cost of processing direct debit payments is lower than most other methods the direct debit is collected rather than the customer having to remember to make a payment the money is credited to the council s account the day of the debit so there are no delays Reduction in collection costs helps to keep additional charges down. In 2013/14 we are looking to achieve paperless Direct Debit for FSS customers where the need to complete a mandate and post in will be ceased as the customer will be able to call the call centre and set this up over the phone. Standing order 3.8 However the council also accepts standing orders as an alternative to direct debit where this is more convenient to the customer. A standing order is also an automated payment via the BACS system from the customer s bank. The customer completes an instruction to the bank to make payments of a given amount to a stated timetable. Paypoint 3.9 Paypoint has a wide network of agents and is convenient for customers, who can use any one of several payment methods. The council supplies the customer with a plastic card marked with a barcode and reference number. The customer then presents the card to a Paypoint agent when making a payment. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 38

Online payments and internet banking / telephone banking 3.10 The Lambeth Council website has a pay online link on its homepage, which takes the citizen to a page listing the funds that can be paid online (www.lambeth.gov.uk/payonline/). Once the relevant fund is selected, the customer then enters the required reference number and debit or credit card details to make a payment. This is an entirely paperless transaction. Giro 3.11 The customer can make payments at a bank or Post Office using an invoice or paying-in slip. However, this an expensive and time consuming method, and the council encourages customers to use other methods of payment where possible. Touchtone 3.12 The customer can make payment with a credit or debit card using a touch tone phone following a set of automated prompts to enter the payment details. Kiosk 3.13 The customer can make payments with cash or card at a machine. The system is currently live for all council services.. Easymobile 3.14 Council officers will soon use a handheld device similar to a Chip & Pin machine to take a debit or credit card payment from the citizen. Customers will be familiar with similar devices in shops and restaurants. Credit Cards 3.15 Effective 1 st September 2012 there will be a surcharge of 1.65% on any transaction paid using this method. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 39

Appendix D - Request for Financial information Request for Financial Information NAME: DATE OF BIRTH: / / ACCOUNT NUMBER: NATIONAL INSURANCE NO: CONTACT NOS: VEHICLE REGISTRATION NO WHO ELSE LIVES WITH YOU: RELATIONSHIP INCOME / BENEFIT NAME DATE OF BIRTH TO YOU DETAILS: / / / / / / INCOME SELF EMPLOYED Yes No IF UNEMPLOYED, STATE SINCE EARNINGS OUTGOINGS YOURSELF: RENT/MORTGAGE YOUR PARTNER: INSURANCE BENEFITS: COUNCIL TAX (PLEASE STATE WHICH) HEATING / HOT WATER PENSION FOOD / HOUSEKEEPING FAMILY CREDIT LOANS / CREDIT CARDS CHILD BENEFIT FINES / COURT ORDERS RENT FROM LODGERS TRAVEL EXPENSES INCOME FROM SAVINGS SKY/LOTTERY OTHER INCOME OTHER OUTGOINGS TOTALS TOTAL SAVINGS DISPOSABLE INCOME: YOUR PROPOSAL FOR PAYMENT IS: CURRENT EMPLOYMENT DETAILS JOB TITLE: PAY REF / WORKS NO: NAME OF EMPLOYER: OFFICE ADDRESS: POST CODE PAYROLL ADDRESS: POST CODE EMPLOYER S TELEPHONE NUMBER: I DECLARE THAT TO THE BEST OF MY KNOWLEDGE AND BELIEF THE INFORMATION GIVEN ON THIS FORM IS TRUE AND COMPLETE. SIGNED: DATE: / / Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 40

Appendix E - Vulnerable Persons Policy Finance and Resources Revenue, Benefits & Customer Services Division Vulnerable Persons Policy February 2010 v5 Introduction Lambeth Revenues and Benefits department is responsible for the collection of all revenue for Council Tax, Business Rates, Housing Benefit Overpayments, Sundry Debts and other income streams, this amounts to over 200m per annum. Whilst collection is paramount in order to provide services to our residents we have a number of residents who can be described as vulnerable. For these customers, it may be a temporary or long-term state which requires Revenues to ensure it responds in a supportive manner when managing debt collection with such customers. While the council has a legal obligation to pursue outstanding debt, this policy outlines how we will do so in a manner that does not exacerbate the vulnerability of the individual. This policy sets out guidance as to how Lambeth Council categorises residents as vulnerable and the potential actions that should be taken. However it is not to be taken Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 41

as either definitive or exclusive. Officers should do what ever they are permitted and able to do to ensure that vulnerable residents are fully assisted. Vulnerable adult definition A vulnerable adult is a person aged 18 years or over who is or may be in need of community care services by reason of disability, age or illness; and who is or maybe unable to take care of him or herself, or unable to protect him or herself against significant harm or exploitation. Whether or not a person is vulnerable in these cases will depend upon surrounding circumstances, environment and each case must be judged on its own merits. However, it may include but not be limited to the following: Physical and mental disability, including long-term illness Language barriers for customers who do not speak English Domestic violence, physical and mental abuse Homelessness It is important to note that the above does not constitute either an absolute list nor give automatic qualification. Each case must be decided on its individual merits. It may be that a number of relatively minor issues in a number of categories may lead to an overall vulnerability. A vulnerable adult classification may also be temporary. For example, when a resident / customer is affected by a severe but treatable illness which may prevent a person from carrying on as they would typically. This policy sets out guidance as to who may be vulnerable and the actions that should be taken. However it is not be taken as either definitive or exclusive. Officers should do what ever they are permitted and able to do to ensure that vulnerable residents are fully assisted. When it becomes apparent that a resident is vulnerable, an email should be sent to the following Services for their information and action: Council Tax Housing Benefit Overpayments Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 42

Sundry Debts ACS Housing Identification The council does not routinely gather information regarding residents medical or other personal circumstances. Indeed were it to do so, it would run the risk of criticism by the Information Commissioner as the information would be deemed as excessive for the purpose (i.e. routine billing and collection of council tax, assessment of benefits, paying invoices). Therefore, the council is not always aware of an individual s personal circumstances. That said, it is important that any information received that might indicate vulnerability is recorded and further investigations started immediately. Wherever possible information should be supported by a statement from an expert body (e.g. medical circumstances should be verified by qualified medical staff looking after the person). Information from the following sources can be considered as being from experts : General Practitioners and other medical professionals Adult and Community Services Mental health agencies and support groups Advice centres Welfare bodies Again this is not definitive. If an officer considers that a person s circumstances, although not evidenced as above, warrant the care offered by vulnerable status then the officer should move forward on that basis. The following benefit entitlement can also assist in determining vulnerability: Higher level award of Disability Living Allowance (DLA) Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 43

Attendance Allowance Industrial Injury Benefit Bereavement Benefits It may be that a person is suffering from transitory issues that impact on their ability to meet their obligations to the council. It would be entirely correct for the account to be coded and the circumstances subjected to periodic reviews, say 6 monthly. All vulnerable coded accounts need to be reviewed regularly and a report sent to the contract manager for agreement at least bi-annually. When to apply the vulnerable person message codes In short, as soon as there is a reasonable suspicion of vulnerability. It is desirable to have two codes available; the first to provide an immediate marker for use as soon as there is a reasonable suspicion of vulnerability. The second will be the permanent marker for use when sufficient evidence of vulnerability has been received. What to do when a person is considered vulnerable Even though a person has been identified as vulnerable, it does not mean the person has automatic relief from paying their debts to the council. Rather it means that suitable adjustments need to be made to the way the council interacts with the person and collects from or pays monies to them. For example, once an account has been coded as vulnerable a plan of how to maintain an effective relationship with the person should be developed. In doing so, the following matters should be addressed: Check or recheck eligibility for any discount/exemption (review status of all residents of property). Check or recheck eligibility for council tax or housing benefits Check eligibility for any other welfare benefit (provide a contact name from Lambeth social services or CAB details). If the vulnerable person has a representative, familial or professional, ensure all accounts forwarding details are properly updated. Ensure the representative is aware and agrees to act on the vulnerable person s behalf for council tax, benefit and other purposes. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 44

Is BACS payment suitable for payments? Make arrangements for the customer to be kept fully informed by an appropriate method (e.g. Braille documents for a blind person, home visits, contact with the taxpayer s representative etc.). Once it has been agreed that a person is vulnerable an email should be sent to relevant sections advising of the person in questions vulnerability, in the case of council tax customers, this action will be taken by the client team. Debt management In cases where there is a significant level of arrears and an arrangement appears impossible then the council may consider writing off some or all of the arrears debt providing the current year debt is covered by a payment arrangement. A recommendation to write off should contain details (where applicable) of the following. A full means statement Copies of any benefit entitlement Information pertaining to ill-health Details of the nature of the debt, e.g. failed business Details of any savings, assets, expenses and other debts (such as rent) Statement why debt should be written off, e.g. old age, no chance of recovery, should have been on Council Tax Benefit no prospect of bankruptcy dividend, committal etc. In addition consider whether the vulnerable person would benefit from a home visit or need referral to one of the statutory care agencies, such as Lambeth Adult and Community Services. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 45

Appendix F - Advice centres in Lambeth Brixton Advice Centre Clapham Community Project Lambeth Law Centre 167 Railton Road St Anne's Hall Unit 47 Brixton Venn Street Eurolink Business Centre London London 49 Effra Road SE24 OLU SW40BN London SW2 1 BZ Phone: 020 7733 4674 Phone: 020 7627 0240 Phone: 020 7737 9780 Lambeth Citizens' Advice Bureau Waterloo Action Group Centre 70 llex House 14 Bayliss Road 46 Knights Hill 1 Barrhill Road Waterloo West Norwood London London London SW2 4RJ SE1 7AA SE27 OM Phone: 020 8674 8993 Phone: 020 7261 1404 Phone: 020 8670 0070 Age Concern Lambeth Disability Advice Service Lambeth 6 Electric Avenue 336 Brixton Road London London SW9 8M SW9 7AA Phone: 020 7733 0528 Phone: 020 7738 5656 Operational matters - Questions to ask Is English your first language or do you need any help communicating with us? Are you housebound? Do you own your own home or any other property? Do you require a home visit? Do you require assistance in completing the form or parts of it? What prevents you from completing the form? Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 46

Do you have a carer or guardian, who looks after your affairs? Are you alone? Is their any one in the household who can assist you? The above is not a definitive guide, but should be of assistance in ascertaining the status of an individual. Once we have answers to some of the above questions, we will be able to build up a picture of the individual s needs and make an informed assessment. The recording of this decision should be communicated to the individual concerned or person who is supplying the information. Academy Council tax The vulnerability codes are available as Circumstance Codes in the Account Notes frame (ct1270). Benefits The same codes are available as User Warning codes in the Claim Details frame (hb3070). Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 47

VT Vulnerable Temporary This code should be applied immediately to the person s account or claim by any officer having reasonable suspicion that a person may be vulnerable. The officer should begin to gather supporting evidence and inform the taxpayer accordingly. VP Vulnerable Person After the investigation is finished and the officer is satisfied that the person is vulnerable, this code will be entered on to the account by the officer dealing with the account in consultation with their team manager, or another authorised officer. It should replace the VT code. It will stop recovery notices being issued against debts and will be used to identify cases that will receive a tailored approach. For council tax the final decision as to vulnerability lies with the Council s client manager. For benefits the final decision lies with the Benefit Officer. It may be that a person is suffering from transitory issues that impact on their ability to meet their council tax obligations. Then it would be entirely correct for the account to be coded and the circumstances are subject to periodic review, say 6 monthly. Coded accounts will be reviewed regularly to ensure that the process is not being abused and all accounts are being dealt with in accordance with their individually agreed arrangements. We will regularly cross-reference the various databases to ensure conformity of approach. Home visits Where Benefit Officers identify facts from claim forms that make them think the claimant could be vulnerable, and there is no other method of obtaining the information required, an Appeals & Customer Care Officer is asked to visit that person and ensure assistance is given. The details established as a result of the visit are then entered as a Visit Report on Anite and a synopsis of the report entered on the council tax Account Notes and the benefit Claim Notes. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 48

The council also receives requests from external agencies, such as Age Concern, to visit cases where potential claimants are known to be vulnerable. The appeals and customer care officer then feeds the result of the visit as above. If the account is solely for council tax the home visit will be undertaken by a Council Tax Inspector and a detailed report will be produced and placed in CTax Anite and on the Academy account notebook. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 49

Appendix G - Hardship Relief for NNDR Payers Introduction Hardship Relief for NNDR Payers Background Section 49 of the Local Government Finance Act 1988 provides that a billing Authority may Reduce any amount a person is liable to pay under S43 (occupied hereditaments) or S45 (unoccupied hereditaments) or: Remit payment of the whole of any amount a person would otherwise be liable to pay under S43 & S45 of the LFGA 1988. Under S49, the billing authority may not grant relief unless satisfied that The ratepayer would sustain Hardship if the authority did not do so; and It would be reasonable to do so, having regard to the interests of persons subject to its council tax. The term Hardship is not confined to financial hardship; all circumstances should be considered in judging whether the payment of rates will cause hardship. Examples of when Hardship relief may be granted include: - Employment Issues Amenity issues and Financial Issues Hardship can be given to individuals and companies or corporate bodies The Billing authority cannot adopt a blanket approach to awarding hardship. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 50

If the billing authority decides not to award hardship, the matter cannot be raised as a defence against the application for a liability order, all appeals must be by way of judicial review. The government only provides subsidy for 75% of any hardship awarded, i.e. only 75% can be claimed back via the NNDR3 return. The remaining 25% needs to be met by the authority. Rules to be adopted for the consideration of hardship cases The ratepayer or someone acting on their behalf must make applications in writing. Accounts for the business for the last 3 years must be submitted with the application form. If 3 years are accounts are not available, their accountants or bankers must provide details of the financial position of the ratepayer. The business should generally have been established in the Lambeth borough for a minimum of 2 years and be a sole trader or employ local people. No account is to be taken of hardship circumstances where the hardship resulted from the improvidence of the ratepayer, or through their own actions, e.g. self induced through their own misjudgement or over optimism or other similar error. All available alternatives to alleviate any hardship must have been investigated by officers prior to submission of cases for consideration by the Revenues Manager, e.g. accepting a solicitors undertaking to discharge the outstanding rates from the proceeds of sale, placing a charge on the property pending sale, suspending payments for a period, entering into an arrangement for payments over an extended period etc. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 51

Criteria The following may be considered appropriate grounds for granting hardship relief up to 100% of the rates payable. The business provides a service to the local community, which would not be replaced, if the ratepayer ceased trading, or for which no alternative provider currently exists in the area. The ratepayer is suffering from a long-term illness. The ratepayer has ceased trading due to death or ill health of the ratepayer and the lease cannot be surrendered and the person entitled to the interest in the property is on a low income. The ratepayer is an organisation to which the Council s guidelines for granting Discretionary Rate Relief under S47 of the LGFA 88, applies and no relief has been granted for a period prior to the year of determination due to S47 prohibiting backdating to earlier years. The business has been effected by temporary action by the Council and no allowance can be made through a rateable value reduction given by the VO. The ratepayer is entitled to possession of vacant business premises through circumstances over which they have no control, are on a low income and are unable to dispose of their interest There are funds available in the budget for the debt to be written off. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 52

Hardship Relief for Rent Payers Policy 1.0 Introduction From 21 June 04, the Quality Team will no longer be responsible for processing DHPs. Instead, the Private and Public sector nominated officers will deal them from that date. A DHP in tray has been created on Anite to facilitate this. 2.0 What to do with claims identified from 21.06.04 DHP claim completed Where the claimant has completed a DHP claim form, it will automatically route to the DHP in tray. Request on HB claim Where the claimant has requested DHP on HB application form, you should process the HB form in the normal way and send an internal memo to the DHP in tray advising about the request for DHP. Request on a letter If the claimant has requested DHP in a letter and there are other issues that also need to be addressed (e.g. appeal), then send an internal memo to the DHP in tray and process the letter as normal. If there are no other issues, then index the letter to the DHP in tray. 3.0 Sending out DHP forms Please do not send out a DHP claim form in the above instances. This is because we can often make a decision without a DHP claim e.g. where claimant is not receiving any Housing and/or Council Tax Benefit or there is other information that allows us to determine the claim. If you do send out a DHP claim form, please check to ensure that the HB assessment is correct and that the claimant does not have maximum or nil entitlement. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 53

4.0 DHP Appeals A claimant can ask us to review a DHP decision. They make this request in writing. Where a request has been received, the letter should be indexed to the DHP in tray. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 54

Appendix H - London Borough of Lambeth Financial Shared Services & Partners Service Level Agreement 1.0 Introduction 1.1 Overview This Service Level Agreement (SLA) aims to outline the responsibilities and required performance levels of FSS alongside the following Partners: Lambeth Primary Care Trust Lambeth Living TMO s EMB s DWP For the purpose of this SLA document the above will be known as Partners 2 The Agreement 2.1 Statement of Intent This document is a service level agreement between the Financial Shared Services and the Partners. This document represents the intention of both parties to enter into an agreement for the prompt payment of each organisations invoices. 2.2 Partnership Principles In the spirit of partnering, the parties will work to develop an environment of co-operation and trust, using the following Partnership Principles: Be accountable to the joint responsibilities set out in the Agreement. Collaborate and co-operate to ensure that service activities are delivered and actions taken on a joint basis Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 55

Be open communicate openly about major concerns, issues or opportunities relating to the services provided Learn, develop and achieve potential share information, experience and skills to learn from each other. Work collaboratively to identify business improvements, eliminate inefficiencies and reduce costs. Adopt a positive outlook demonstrate a positive can do attitude, looking at ways to improve services Focus on excellent customer service 3. Financial Shared Services The following activities are provided by the Financial Shared Services. 3.1 Service Offering Activity by Service Line Service Line Payment Services (P2P) Accounts Payable Service Line Activity To meet agreed payment terms on Partner Accounts Payable invoices. To resolve Partner queries and where not possible, assist with the resolution with the Lambeth Departments for whom the Partner has billed. Billing & Collections Creation on request, printing and despatch of Departments Invoices, Credit/Debit Memos and Statements due to the Partner. Clear unapplied cash and cash on account on Partners accounts on the instruction of the Credit Controllers To assist in the resolution of queries raised by the Partner. Collection of monies due from the Partner to the London Borough of Lambeth Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 56

To remedy any overpayments made by the Partner To resolve queries relating to outstanding invoices due to Lambeth departments by the Partner. Debt & Overpayment Overpayment Referral form DWP and LAs to provide a mechanism for local contact to deal with enquiries between LAs and DWP Referrals / response to be made on the National Standard The Service Level Agreement will apply from April 2013 to March 2014 3.2 Hours of Operation Standard business hours for the services provided are Monday through to Friday 9.00am to 5.00pm (with the exception of public holidays). 4. Partners Accounts Payable Teams To pay all London Borough of Lambeth invoices within the standard 30 day terms, unless in dispute. To advise the London Borough of Lambeth contact name on invoices and the FSS Billing & Collections team of any invoice that is in dispute within 14 days of the date of the invoice. In keeping with the Partnership Principles, to inform the FSS Billing & Collections team of any major issues which may effect the timely payment of Lambeth invoices. If the above actions are not adhered to, the London Borough of Lambeth, Financial Shared Services reserves the right to apply Statutory Late Payment Charges of current base rate + 4% to any overdue invoice. In exercising this right, the London Borough of Lambeth accepts that the Partner has the right to apply reciprocal Late Payment Charges on their overdue invoices. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 57

Appendix I - Protocol for Payment of Business Rates and Council Tax for Council Owned Property Protocol for Payment of Business Rates and Council Tax for Council Owned Property Agreement between Revenue Services & Heads of Finance Introduction: Presently, Housing are provided with a quarterly schedule of Council Tax owed on domestic property, this works well as a code is provided within a short period of time (5 days) to the Contract Manager for a journal to be processed and accounts paid. NNDR has proved to be more difficult as most departments have NNDR liability. Whilst some departments are extremely good with notifying liability amendments or codes, others are not and a considerable amount of time has to spent chasing the debts not always successfully. Proposal to resolve issues going forward; Effective from financial year April 2010 to 2011 and ongoing each department will either advise the Revenues Client Manager of their departmental Oracle code to debit for the NNDR & Council Tax charges within 28 days of receiving either the emailed schedule or a demand for payment through the post. If the department notified of the debt are no longer responsible for the property, full information of the new occupiers will have to be supplied in the same timescales. Failure to comply with the agreement will result in an escalation to the Divisional Director (Corporate Finance) for final decision. Lambeth_Corporate_Income_and_Debt_Recovery_Policy_Final_2013'14-7162013_355 PM.doc 2013/2014 Page 58

Appendix J - Sundry Debtors Scale of Charges & Fees Setting fees and charges Lambeth Council is committed to setting reasonable fees and charges which reflect its strategic priorities and outcomes. The council s fees and charges will be reviewed annually and customers notified of any changes. Charges and Fees are paid, depending on the stage of the work for part or the entire recovery process to include Pre Action, the issue of Court Proceedings, Defending Court Proceedings and obtaining a Judgment Order and Enforcement Proceedings. Sundry Debt charges Solicitors Pre Action and Court Proceedings Defending Court Proceedings Obtaining a Judgment Order Charges Subject to the level of contact with the Debtor Subject to the level of contact with the Debtor Subject to the level of contact with the Debtor Enforcement Proceedings Subject to the level of contact with the Debtor Charges on Property Deferred Payments (Due 56 days after death) Base rate + 2.5% HASSASA Charge (Due immediately after death) Base rate + 2.5% Statutory Late Payment Charges Base rate + 4% Court Costs and Charges for Council Tax and NNDR 2013/14 Council Tax NNDR Amount if different Summons Costs 122.00 145.00 As stated Yes Liability Order Costs 5.00 25.00 As stated Yes Bailiff 1st Visit Fee 24.50 24.50 Legislated No Bailiff 2nd Visit Fee 18.00 18.00 Legislated No Levy Fee % of debt % of debt Legislated No Warrant with Bail 85.00 85.00 As stated Yes Warrant without Bail 105.00 105.00 As stated Yes Charging Order 268.00 489.00 As stated Some Payable to Council Y/N Page 59