Hard times for bailiffs in a debt shortage

By MARK FOXWELL
Updated: 11:10 EST, 15 September 2010

If asked to choose a business that would boom during a recession, you might think it would be bailiffs. But surprisingly, Britain's official debt collectors have seen their businesses squeezed by the downturn.

The bailiff trade body, the Enforcement Services Association, said the amount of debt referred for collection by its members this year was lower than last year.

Jamie Waller, founder and managing director of JBW Group, one of Britain's leading bailiff firms, said business had shrunk by between 25 and 30 per cent since the start of the credit crunch.

Squeezed: Bailiffs may be a casualty of the credit crunch

'People are taking a more careful approach to their finances since the recession started,' he said. 'It's had the reverse effect, which has left many bailiff companies overstaffed.'

Several leading firms are rumoured to be cutting jobs. Waller, whose company employs 191 staff, including 147 enforcers, said companies were changing their debtcollecting tactics to cut costs.

'We are handling a lot more cases over the phone, instead of turning up at people's homes. In the past 18 months we have seen this increase by 38 per cent,' he said.

Waller also said that debtors were quicker at paying up. 'We are now seeing that 60 per cent are paying up after receiving only a letter,' said Waller.

Historically low interest rates have saved many people who might otherwise have defaulted, while banks and other lenders are calling in fewer bad debts.

Many observers expect a round of takeovers in the sector should it continue to face a squeeze. The first opportunity for a merger could be the sale of NSL, a bailiff business put up for sale by private equity group 3i in May, with a price tag of about £130million.

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