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Debt – persecuting the poor

Those struggling to pay their bills will not get any sympathy from the new water company.  A Water Service discussion document that was leaked to the media revealed that some householders could face legal action for unpaid water charges within seven weeks.  Drawn up by Crystal Alliance, the company that has been awarded the £7m contract by the Water Service to run its billing system, this document sets out a strategy for debt recovery.  This envisages a two-tier system of debt recovery based on a persons’ credit rating – high risk or low risk.  Householders are given the labels “affluent achiever” or “rock bottom”.  The strategy for debt recovery differs depending on which category a person falls into.  Everyone receives a bill at the same time, but those categorised as high risk will get a reminder after 14 days, but low risk householders will not get that letter for another two weeks. On day 21, the final demand will arrive at the high risk house, but the low risk customer will not get that until day 49.  Meanwhile, on day 49, the high risk customer has been referred to a debt collection agency or recommended for legal action. The low risk customer gets another 34 days grace before they find themselves in a similar position. The poorest householders, those most likely to have a poor credit rating and least able to pay, are pursued more ruthlessly than wealthy householders who are the most able to pay.  While the Water Service says it will not use demeaning labels such as “rock bottom”, the principles that lie behind such terms will still be in place.  The fact that they have adopted such a ruthless debt recovery strategy indicates that they know full well that water charges are a burden many families will be unable to bear.


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