Credit Management November 2022

EDITOR’S COLUMN
Is HMRC about to get tougher
on distressed debtors?
Sean Feast FCICM
Managing Editor
YOU know sometimes
when you can see
a disaster about to
happen, but you feel
powerless to do anything
about it? That’s how I’m
feeling at the moment and it’s making
me feel increasingly ill-at-ease.
No, I’m not talking about the farcical
merry-go-round of British politics –
though that’s terrifying enough. They’ve
managed to take my understanding
of the word incompetence to a whole
new level. What I’m more concerned
about is the looming debt crisis, where
thousands of businesses, and many
hundreds of thousands of consumers,
will find themselves facing bills they
simply cannot pay.
The figures are already there to
prove it. Some 3,619 businesses failed
in August and September, and in
September alone, 12,280 individuals
were declared bankrupt. As Christina
Fitzgerald, President of R3, says, with
rising living costs, both business
owners and employees are under
significant financial strain and it
has led to rising salary demands and
increasing pressure on margins, which
some businesses haven’t, unfortunately,
been able to meet (see news page 8).
Which means creditors are going
to have to be more understanding
than ever of a debtor’s circumstances,
and on the consumer side of things,
organisations like StepChange Debt
Charity are urging much earlier
signposting as regards where help is
available.
But not every creditor, it seems,
is going to be so understanding.
Already the mood music coming from
His Majesty’s Revenue and Customs
(HMRC), for example, suggests that
far from showing greater forbearance,
they might, in fact, get even tougher
on those in financial distress (see
Troubled Waters, page 10). Which worries
me enormously. Because we’ll find
ourselves transported back a decade
or so ago, with the Government saying
one thing about needing to clear out the
aggressive tactics of the private sector
in the collection of debt, whilst failing
to look at the shockingly bad treatment
meted out by agencies in its own back
yard.
Let’s hope I’m wrong, and let’s hope
wiser owls than me who I’ve spoken to
are also wrong, and HMRC will maintain
its supportive approach. Because while
the rest of us may be demonstrating
compassion and forbearance by the
bucketload in the months to come,
HMRC’s privileged position at the head
of the creditor queue has far reachingimplications
for us all.
Brave | Curious | Resilient / www.cicm.com / November 2022 / PAGE 4