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“The Debt Claim Process”

Volume 477: debated on Friday 13 June 2008

I am publishing a response to the consultation paper “The Debt Claim Process: helping people in debt to engage with the problem”.

This was a formal consultation exercise undertaken by Her Majesty’s Courts Service to report the findings of a pre-action protocol pilot and to seek views on other proposals for increasing debtor engagement and streamlining court processes.

The paper discussed the following options:

Do nothing—simply retain the current requirements.

Introduction and operation of the PAN—this would require all creditors to issue a pre-action notice generated by the court. Where there was no response to this the creditor would be free to start proceedings.

Strengthening of the current civil procedure rules requirements—this option discussed whether the existing requirements should be extended to include: provision of information about negotiating with the creditor; how payment could be made; sources of free independent advice and assistance; and time to obtain advice.

Introduction of a debtor protocol—introducing a requirement that debtors must respond to claims or face possible cost sanctions.

The introduction of a claims payments order—this would allow creditors to move directly to the ‘enforceable order’ stage when a debtor failed to respond after mandatory pre-action steps had been followed. This measure was designed to target the ‘won't pay’ group more directly.

The response rate to the consultation was low—around 8 per cent.—possibly due to the number of times these topics had previously been aired. However, it was clear that there was little support from any of the sectors for the introduction of the PAN, a debtor protocol, or the CPO. There was, however, a general support for strengthening the existing requirements covering pre-action behaviour in the CPR. This will now be considered by the Civil Justice Council (CJC).

Copies of the response paper have been placed in the Libraries of both Houses and are also available on the internet at