CM September 2021

CMNEWS
A round-up of news stories from the
world of consumer and commercial credit.
Written by – Sean Feast FCICM
CSA considers impact of
decriminalising TV licensing
on BBC revenues
POLICY makers need to think
carefully before decriminalising
TV Licensing and consider the
fundamental impact it may
have on future fee collections.
Incidences of late payment will
almost certainly increase, revenues will fall,
and the cost of collections is likely to rise.
By making the non-payment of a TV
Licence a civil matter, and not a criminal one,
the enforcement process will be different,
and the cost to the BBC may increase. Rather
than having more money to invest as the
public service broadcaster, it is likely to have
less, something that both Ministers and the
BBC will need to factor in to future plans.
With the Government set to consider
decriminalisation of the BBC TV licence
fee as part of its ‘roadmap for reform’ of the
BBC in the year ahead, the Credit Services
Association (CSA) has published a discussion
paper exploring the issues facing Ministers if
public service fees and levies, such as the TV
licence, migrate into the civil debt space.
While being careful not to take sides on the
specific merits or otherwise of a TV licence
decriminalisation policy, the new paper
from the CSA – the trade body for the debt
purchase and collections sector – highlights
a series of technical considerations decisionmakers
should factor in, including: the
impact higher evasion rates could have in
increasing costs for those who do pay their
fees, in the same way fare dodgers push up
the cost of rail tickets for honest travellers;
and how a change in consequences for
non-payment will affect which creditor a
customer pays first (i.e prioritises), and the
impact this may have on income models for
public services.
It also considers how the ability to recover
a civil debt depends on proof that the debt
exists in the first place – and how technology
changes and use beyond the public domain
make this challenging – as well as how the
different psychological effects of criminalised
penalties versus non-criminalised sanctions
might impact collectability
Chris Leslie
CSA Chief Executive
“Effective and
fair collection
strategies,
drawn from
existing recovery
specialisms and
anchored in
good practice,
will be critical
in ensuring that
user-funding
public services
continue to
be adequately
funded."
The CSA Discussion Paper “Looking
After Auntie: what can the debate about TV
Licensing tell us about the wider challenges
of decriminalisation?” invites a discussion
not only on the financial model for BBC
funding, but the wider array of hundreds of
public sector levies currently subject to a
criminal sanction, such as fishing licences or
road traffic fines and fees.
Crucially, the report highlights how future
‘civil’ approaches should include plans to
invest in alternative customer relations,
effective early engagement and good
communication.
The June 2021 Ministerial response to
the recent DCMS Select Committee report
said that they are “keeping the issue of
decriminalisation under active consideration”
and that “the Government may in future
undertake a further, technical consultation
on the possible alternative civil sanctions
to set out in more detail how alternative
schemes could work in practice.”
Report author Henry Aitchison believes
that decriminalising fees and levies, such as
the TV licence, would fundamentally change
the funding models that they underpin.
Henry told Credit Management that it needs
thinking through very carefully:
“If a criminal penalty is abolished, the
task of maintaining or recovering payments
changes. With Ministers signalling a new
technical consultation on alternative civil
recovery schemes, now is the right time
for policy-makers to consider the wider set
of public sector fees and levies currently
subject to criminalised penalties – and the
consequence for the structures they support
if these move to a non-criminal sanction
basis.”
CSA chief executive Chris Leslie added:
“Effective and fair collection strategies,
drawn from existing recovery specialisms
and anchored in good practice, will be critical
in ensuring that user-funding public services
continue to be adequately funded. This is a
policy debate to which the wider collections
sector will contribute in the months ahead.”
Advancing the credit profession / www.cicm.com / September 2021 / PAGE 5