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Water Companies and running defaults - past 6 years

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  • Water Companies and running defaults - past 6 years

    Not sure if other forum members are aware of the following in connection to water companies reporting to CRA's for which i have been trying to find an update because a review was supposed to take place after 5 years by the ICO. Can anyone provide an update or knows if the below allowing running defaults has been changed?:-

    Normally, once 6 years has passed since the original Default Date a record will automatically be removed. To ensure that customers who fall into the above scenario, who are continually not making payments, do not have the default disappear, a running default will effectively be created. This will involve the oldest default details dropping off at year 6 and the newest default adding in. In order to manage this process there needs to be some changes made to the Original Default Balance and the Default Date field.


    Water Companies CAIS Reporting Guidance

    Final May 2012



    Tags: None

  • #2
    I don't know if a review has been carried out, but yes it seems a review was due May 2018 -
    It has been agreed with the Information Commission that a review will take place after 5

    years to see if this scenario does actually occur as it is suspected that once customers

    realise they will get defaulted by water companies they will not default account after

    account.
    I can't find anything saying a review has happened, a FOI request could be made to the ICO for the information if they can't tell you directly ( eg by ringing them ) - https://ico.org.uk/about-the-ico/our...ation-from-us/

    Something like " In the Water Companies CAIS Reporting Guidance dated May 2012 the report it is stated that a review of reporting procedures will take place after 5 years, please can you confirm whether such a review has taken place and provide me with a copy of any report relating to this review. "

    ( I'm sure there's more specific info you'd want to detail )

    You can also ask OFWAT a similar thing - https://www.ofwat.gov.uk/foi/


    That aside, are you experiencing a problem with the reporting on your credit file ?

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    Comment


    • #3
      Hi Amethyst

      Many thanks for getting back to me.

      No real problem with the reporting, only that the water utility is not a financial credit provider, so (to my mind) should not have the right to report on customers on the CRA platforms.

      Im more interested in whether or not the 'running defaults' past 6 years is still allowed.

      Strange, i don't think this bit of information (running defaults) is common knowledge, and i do wonder what other defaults it is being attached to?

      Many thanks for the leads. I will follow up and report back on here:-)

      Comment


      • #4
        sorry it's taken a long time for me to post, ill health and work have overtaken me atm.

        I used to work for a water company, and this is the information that we have been given.

        Water companies requested the right to apply defaults to credit ratings via Ofwat and were given permission as long as they were transparent and open in their doing so.
        In approx April 2016 (to my knowledge it could be earlier for other companies - please don't shoot the messenger) letters were sent stating that the companies would be reporting to CRA, and giving the debtors the chance to put a plan in action or pay the balance before this happened.

        There was to be a department solely in charge of disputes, anything statuate barred etc would be removed and any damage repaired etc. There was no concrete line on compensation so I honestly do not know.

        As far as I am aware, they cannot report on anything over 6 years old, under £50 or with an active payment plan that is being adhered to.

        hope this helps

        Callie
        PLEASE NOTE: I work irregular hours including nights and sleep in shifts. If I have not responded in 48 hours, please ask an admin to Messenger me!

        "If you ever feel alone, remember, I am just the other side of the rainbow, or just south of the North Star. Whichever is closer." - A.J Murphy. 17/3/1974 - 16/03/1997 (RIP babe <3)

        Comment


        • #5
          HI SC

          Many many thanks for the information.

          I have emailed the ICO, so now waiting for a response and will post on here once received.

          From the example you have given, (please excuse any misunderstanding on my part) your instructions(former instructions) would apply to a 1 off debt, not a debt rolling on and being added to from year to year?

          the example given in the guidance show

          year 1: 500 owed
          year 2: 500 + new 500
          year 3: 1,000 + new 500

          and so on, until the customer pays

          in this type of example only 1 default is placed from year 1 and the default details added to each new year of non payment.

          What i didn't understand was what would happen if 6 years of water debt had built up, would the default covering the past 6 years (containing each year's additional debt) fall off the credit record completely, and a new default issued from year seven if nothing was paid?

          example

          year 1 500
          year 2 500+ 500
          year 3 3x 500
          year 4 4x 500
          year 5 5x 500
          year 6 6x 500

          year 7 1x 500 (because the original default contains the figures from year 2-6)

          i think the guide is saying that the rolling default will never clear from the credit record at all unless the total debt outstanding is cleared.

          I'm getting crossed eyed trying to fathom it? Must be similar to a gas/electicity debt if 6 years of year on year billing never addressed and paid?

          Comment


          • #6
            To the best of my knowledge, the following scenario would happen.
            April - June each year, letter generated reminding customers that non payment is now registered with CRAs. This is normally sent with your bill, but it is also freely available on website so covers the transparency agreement.

            Customer pays in full - no marker added/marked as good payer

            Customer sets up payment plan.
            keeps to schedule/pays off early - no marker added/good payer

            Customer sets up plan
            0-3 months late - no marker, however Debt Collection can begin.
            3-6 months late marker applied as late payment. low risk Debt Collection will have started.
            6-9 months late- marker applied as continued late payment. low risk. Debt Collection will be in progress.
            12 months onwards - marker applied as high risk of non payment. Doorstep collection will be attempted.

            All markers last for up to 6 years.


            Historical debts are marked up to 6 years old, once 6 years is past they cannot legally affect your credit rating.

            HOWEVER:

            If your debt is:
            Under £50
            Due to a mistake/fault from your water provider
            Due to a spell in hospital over 3 months
            Due to not receiving a bill for over 12 months (and having asked for one)

            Any marker should be removed. Contact your supplier for more help, ask for an appeal/investigation to be made. This can take 30 days and OFWAT will not interviene in the meantime!


            PLEASE NOTE: I work irregular hours including nights and sleep in shifts. If I have not responded in 48 hours, please ask an admin to Messenger me!

            "If you ever feel alone, remember, I am just the other side of the rainbow, or just south of the North Star. Whichever is closer." - A.J Murphy. 17/3/1974 - 16/03/1997 (RIP babe <3)

            Comment

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