How will public collections evolve in 2025?

How will public collections evolve in 2025?

That's a question that was recently posed to me by Le Raine Hendrik, Indebted.co. Her article on predictions for 2025 are here.

Her question prompted some thoughts about what emerging trends we should look out for in the enforcement sector.

Civil enforcement is a function of our justice system, but with local and central governments facing financial pressures, public debt collection is as much about supporting people in financial difficulty as it is recovering for the public purse.

As with all forms of collection, the key is engagement and enforcement agencies have invested significantly in the leading technology. Looking ahead, machine

learning and more intuitive algorithms based on sociology and demography will be critical to segment and profile people to assess their ability to pay. We're already seeing AI being used to enhance customer communication and it may help us to apply behavioural science more effectively to our collections systems.

I would also expect to see more progress in data sharing by public sector bodies using the Digital Economy Act. The challenge in public debt collection is the inability to complete a comprehensive single customer view. This creates friction in the process, which delays the opportunity to signpost to people for debt advice and welfare support.

The significant shortfalls in local and central government budgets means that the government’s debt collection strategy is critical for its growth agenda. The failure to implement an effective fees structure for enforcement firms presents a risk for future investment and the government will need to give this serious consideration if the industry is to continue to innovate and lead the evolution of public debt recovery. A properly functioning market ensures standards are kept high and the government can meet its revenue targets.

Finally, the enforcement industry will adjust to independent oversight by the Enforcement Conduct Board and compliance with the new standards set out in the code of conduct for enforcement firms and agents. There will inevitably be teething problems and the industry has a role in ensuring that ECB intervention is justified and proportionate, based firmly on robust evidence and analysis.