Energy action fuel debt workshop fuel poverty conference dublin castle 7 february 2011
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Energy Action Fuel Debt Workshop Fuel Poverty Conference Dublin Castle 7 February 2011 PowerPoint PPT Presentation


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Energy Action Fuel Debt Workshop Fuel Poverty Conference Dublin Castle 7 February 2011. Michael Culloty National Social Policy and Communications Officer MABS National Development Ltd. Outline Agenda. About MABS High level principles based on experience Utility debt .

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Energy Action Fuel Debt Workshop Fuel Poverty Conference Dublin Castle 7 February 2011

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Energy ActionFuel Debt Workshop Fuel Poverty ConferenceDublin Castle7 February 2011

Michael Culloty

National Social Policy and Communications Officer

MABS National Development Ltd.


Outline Agenda

  • About MABS

  • High level principles based on experience

  • Utility debt


MABS – Free, Confidential and Independent

Objectives:

  • The provision of money advice to people in debt or in danger of getting into debt

  • Empower them by providing knowledge and skills

  • Promote change in policy and practice

  • Focus on low income families


MABS Statistics

Statistics:

  • In excess of 25,000 new active cases in 2010

  • 35% increase in clients approaching MABS in 2009

  • 10% increase in clients in 2010

  • 15% increase in Helpline calls in 2010 (125% increase on 2009)

  • 70% of clients are social welfare recipients (previously averaged 65%)


MABS Stats contd.


Budget Priorities

  • Mortgage or rent

  • “Light and heat”

  • Food

  • Resources available for basic living requirements (education, transport for work purposes, childcare)

  • Court fines etc.

    NB. If any one of the above is neglected the repayment plan will not be sustainable


Experience of MABS in Money Advice

  • 18 years’ organisational experience of dealing with debtincluding utility debt

  • There is a fundamental difference between people who can’t pay and those who won’t pay – must be treated differently

  • Holistic, informal non adversarial approach works - both for the client and creditor

  • The present process for dealing with arrears/consumer debt is inappropriate for many clients

  • Disconnection/court proceedings worsen the situation of people who can’t pay


MABS Approach to Utility Debt

  • A priority debt (see approach in SFS/Money Mgmt Guide etc.)

  • Increase in problematic cases emerging in case work

    Our approach: Arrears:

  • If part of a multiple debt problem will usually seen by Services

  • SFS developed and offers made

  • the main utility supplier, will be prioritised

  • Offer will be a payment on the arrears + the scheduled payment

  • If a single debt arrear – supported self-help via the website or MABS Helpline


MABS Approach to Utility Debt

Our Approach:Disconnection

Where disconnection is part of a multiple debt problem – again, will usually be seen by Services and will be prioritised (this causes increased pressure on MABS Services)

If a single debt issue and threatened disconnection/ disconnected – again will usually be seen by Services but can in some cases be referred to the MABS Helpline

(However, disconnection is often a signifier of a bigger problem - income adequacy, vulnerability, fear)


Vulnerable Consumer

MABS recognises a vulnerable consumer to be someone who for reasons of age, health or disability, the disconnection of gas or electricity presents a clear threat to their or a member of their household’s health or wellbeing


Utility Suppliers/ MABS Protocol presently being negotiated

Basic Principles:

  • is designed to improve operational effectiveness of the energy suppliers/MABS engagement

  • enables and commits the suppliers and MABS to work together effectively to help clients address debt problems in an effective and realistic manner

  • accepts that each supplier adopts a different approach to debt recovery and each case of indebtedness is unique

  • recognises the concepts of full disclosure and debt settlement

  • commits energy suppliers and MABS to work together to formulate a mutually acceptable, affordable and sustainable repayment plan

    Note: Protocol focus is on process – but obviously the goal is to avoid disconnection


Interim report of the Law Reform Commission (May 2010)

  • Extension of the IBF-MABS Operational Protocol on Managing Debt: this will also bring more financial institutions and other creditors into a nationally agreed debt management process, so that it includes not just IBF members (as at present) but also credit unions and, potentially, the so-called “sub-prime lenders” as well as utility companies. The successful outcome of this extension would also make a significant change on the ground for people in difficulties. (Action point 2 of 14).


Energy Suppliers/MABS Operational Protocol

Government’s Expert Group Interim Report

The Group also recognises, in regard to personal debt, the existence and valuable contribution of the Irish Banking Federation - Money Advice and Budgeting Service Operational Protocol (IBF/MABS Protocol) on dealing with debt arrears, the ongoing review of this Protocol and the work being done to extend it to other branches of the credit industry. p 36

The Group recommends that pending the comprehensive reform of the

personal insolvency system in Ireland, that the following measures to

address the problems of personal indebtedness be adopted and facilitated:

The extension of the IBF/MABS Protocol to a wider group of creditors as

an important step towards ensuring that an individual’s debt difficulties

can be addressed in a standardised, mutually-satisfactory and holistic

manner.


Questions

  • What is the process that leads to disconnection?

  • Why is customer contact failing?

  • What to do when sources of help have run out post disconnection, e.g. previously received an ENP and accessed charitable support?

  • Is there enough effort made to determine those who can’t pay vs. those who won’t pay - determining the ability to pay

  • Is there enough effort made to assess vulnerability?


MABS

Thank you

Your Questions


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