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| MAY 2021 | UTILITY WEEK
Customers
Analysis
Waiting for
the debt
wave to hit
Everyone knows a flood
of debt and arrears related
to Covid is about to wash
over the utilities sector; we
just don't know how severe
it will be or when it will
strike. By Jane Gray.
D
ebt and collections leaders in UK utili-
ties are scratching their heads. As the
social and economic fallout from coro-
navirus continue to accumulate, so too do
stark figures on mounting unemployment
and redundancy rates (see infographic).
And yet, by and large the amount of debt
sitting on utilities' books is not sky rocketing.
This leaves those responsible for fore-
casting and collecting debt, as well as those
leading on customer experience, in an
unnerving situation. It seems inevitable that
growing unemployment and an uncertain
job market will translate into a major afford-
s c i t s i t a t s t e k r a m r u o b a L K U
1.4million
the increase in the number
of people claiming
unemployment benefi ts in
the UK since March 2020
(due to changes to UK benefi ts
arrangements since the start of the
pandemic, not all claimants are
necessarily unemployed)
6.5%
5%
2%
The projected peak
unemployment rate expected
in Q4 2021 by the Offi ce for
Budgetary Responsibility
The number
of employers
relying on
the CJRS
The current UK
unemployment rate
The decline in
the number
of payrolled
employees
in the UK
between
March 2020
and February
2021
The decline
in payrolled
employees
for the worst affected
sectors of the UK economy:
and
These fi gures are drawn from ONS data published on 23 March, 2021
1.3
11.4 million
The number of jobs
furloughed via the
Coronavirus Job
Read the report to find out more about working group thoughts on:
• The expected surge in debt from "just about managing" customers
aer furlough ends.
• The challenge of identifying customers vulnerable to affordability
issues when their credit records are good.
• Perceived gaps in products and processes for serving these
customers.
• Job market volatility and its impact on understanding whether
customers represent a short or long-term credit risk.
• The need for cultural change and greater "commercialism" in water
sector debt management approaches.
• The need for reform of water sector social tariffs.
• The importance of self-serve solutions in an environment of rising
consumer debt.
• The digital investment deficit in customer journeys for debt and
affordability issues.
• The potential for great data sharing and better segmentation to
reduce bed debt risks.
Download here: https://utilityweek.co.uk/fighting-an-invisible-enemy-
the-consumer-debt-challenge-for-utilities/
