Examination of Witness (Questions 1 -
MONDAY 24 JUNE 2002
1. Order, order. Good afternoon, ladies and
gentlemen and welcome to the Committee, Sir Hayden. Thank you
for coming today to speak to us about the Comptroller and Auditor
General's Report on the Collection of fines and other penalties
in the Criminal Justice System. For years I used to practise in
the criminal courts as a barrister; I do not know whether I should
declare that. I no longer practise but I do know a little bit
about the problems you face in the collection of penalties and
other fines. May I start by referring to Appendix 2 on page 28?
You will see it refers to a very large number of reports into
the efficiency and effectiveness of financial penalties over the
last 13 years, yet in 2000-01 we learn that only 63% of financial
penalties were collected, in 2001 the rate fell to 59%. It is
a pretty poor record. Why does performance continue to be so poor?
(Sir Hayden Phillips) Despite the giving
of all the guidance, much of it in quite some detail, the problems
have remained really quite intractable. Essentially there is a
number of reasons. First of all, until a year ago the system was
very much a divided system with no-one really in charge. I hope
we have made progress in changing that. Secondly, here is an area
of great importance but of very hard work, often extremely difficult
work, which has not been given the priority which it necessarily
ought to be given for a variety of reasons, one of which is resources.
We have done something now to change that. Thirdly, it is intractable
for a lot of other reasons. A lot of the problems in enforcement
are about tracing the people concerned: a lot of them cannot pay,
many of them will not pay. You are dealing therefore, to put it
crudely, with human nature as well as with bureaucracy and systems.
I want to try to persuade the Committee if possible, that we are
trying to position ourselves now to be able to achieve more and
better in a way which was not easily possible in the past, despite
all the guidance which has been given out.
2. That is what I want to come onto straightaway.
There are intractable problems with the whole system. You are
often dealing with an underclass of people with no means anyway,
no fixed employment, that is why they are in the courts, problems
of means to pay, keeping track of defaulters, that on top of weaknesses
in training, poor record keeping, incomplete management information.
You might feel you could address those latter points but the former
ones are far more difficult. Does all this add up to a fundamental
weakness in the way that fines and other financial penalties are
enforced or indeed a fundamental weakness in the whole system?
(Sir Hayden Phillips) There are and have been systemic
problems. I actually believeyou might say optimisticallythat
we can put in place a range of measures administratively which
can make a real difference. I have been encouraged by the way
in which magistrates, their staff, other stakeholders in the system
all across the country have this year come together in five regional
conferences to share best practice, to talk about new standard
setting, sharper timescales. We have for the first time a performance
target for the payment rate. We are making funds available to
each magistrates' courts committee to fund what they believe is
necessary to improve their performance. I do accept that not enough
has been done and not enough has been achieved, but we are positioning
ourselves to do better. We will still have to dealand this
requires a lot of detailed and careful work by staff and magistrates
on the groundwith a lot of people who are fined, who cannot
pay or will not pay and whose social lives and backgrounds are
such that it is going to be very difficult to tackle that. We
have an information exchange system this year for the first time
with the Department for Work and Pensions and we can go to them,
when we have tried every other means and we cannot find them.
We have raise £465,000 this last year in fines which would
otherwise have been uncollected as a result of better being able
to trace defaulters. In those sorts of ways I do believe we can
3. I want to turn now to the victims. Case study
5 on page 23 is an interesting case. There you have a victim who
is still waiting ten years after the event for compensation. That
is a pretty sorry saga, is it not? There are other cases on that
page which are perhaps not quite as serious as that. What are
you doing to ensure that victims do get these awards paid to them
as quickly as possible?
(Sir Hayden Phillips) I agree with you about that;
I am not pretending that is a good story. The present arrangements
are that victims who are waiting for compensation have to wait
for compensation until the funds are brought in from the offender
to enable that to be done. Suggestions have been made from time
to time that what the Government ought to do was produce a compensation
fund, funded by the taxpayer, which would then pay compensation
out to the victims immediately and it would be refunded over time.
That is probably the only way in which that situation can readily
be changed radically, other than by what I hope will happen anyway,
which is a progressive improvement in the speed of collection.
Obviously a fund of that nature raises important issues of principle
about whether the taxpayer should be asked to do this and raises
issues of cost.
4. A lot of the problem with the courts is delays;
a lot of the problem with enforcement is that it has to be referred
back to the courts. Some courts are trying to delegate some responsibilities
to administrative staff. Is there any scope for easing this process
by reducing referrals back to court and delegating more work to
(Sir Hayden Phillips) The current position on delegation,
which is laid out in the statute and regulations is actually clear.
I have no reason to think that courts do not use that delegation
to the maximum. If you are going to transfer more responsibility
to court officers, you do require primary legislation to enable
that to be done so that officials can get on and deal more directly
and regularly with the person who has been fined, try to find
ways to get the fine in more quickly, without having to go back
5. That is presumably a good process and we
should encourage that process.
(Sir Hayden Phillips) We should encourage that process
and this is something which will be on the list for legislation
at some point.
6. Paragraph 2.17 notes that 90% of penalties
which are written off, are written off simply because the offenders
cannot be traced. What are you doing to try to help magistrates'
courts keep better track of defaulters?
(Sir Hayden Phillips) I agree with you that the level
of write-offs is important. Clearly the payment rate is the thing
we have to try to improve. We also want to see the level of write-offs
going down, because on the whole they indicate that penalties
are not simply unenforceable but have been too difficult to enforce.
Last year the write-off rate went down from £74 million the
year before to £57 million, which is an indicator of a degree
of improvement there. The main way in which we want to speed up
the process is by giving magistrates' courts committees the resources
and the information to be able to put more people onto the case
more frequently, to use new ways of trying to contact people.
Simply by putting more effort into the process, which they can
now do from 1 April this year, we can try to make real progress
in that area. Some of the improvements you have touched on and
implied by your questions, do require legislative action as well
as administrative action.
7. May I ask you now about your performance
data? If you look at paragraph 1.2, you will see that some courts
cannot even distinguish between civil and criminal impositions.
What are you doing to try to improve the reliability and consistency
of data so that you and we know what is going on?
(Sir Hayden Phillips) This essentially means changing
existing IT and manual systems into one which is in a standard
form and which can be relied on to provide local management information
and on a monthly, quarterly, annual basis can sensibly be aggregated
nationally rather than the present range of differing systems
which exists. We have a programme to put that in place. The infrastructure
for the IT has been rolled out across 75% of magistrates' courts
committees, but it will be a little while before we have consistent
and reliable data for every area which can build up a clear national
8. Can you just look to the further horizons?
We discussed the fundamental weaknesses in the whole system of
fines, in tracking offenders, in getting them to pay and all these
other problems. I should like to ask you to ponder on what you
are doing to look at the wider sentencing framework and whether
there are other ways forward. If a penalty is unlikely to be paid
and we all know that many of the people who come through the courts
are unlikely to pay a penalty, cannot pay a penalty, will not
pay a penalty, already have a large number of fines outstanding
against them, all the other reasons we are all familiar with,
do you think the courts have sufficient sentencing options available
to them? Should we resort more to sequestration of treasured possessions
such as cars, curfew orders, weekend prisons, all these other
options and get out of this fixation on fines which you apparently
have so little success in enforcing?
(Sir Hayden Phillips) There is a range of things we
would want to look at. There are some in the Crime Sentences Act
which may be brought into force, which is being able to impose
community penalties where fines are found not to be right, indeed
to impose a community penalty where otherwise someone might be
sent to prison for default. Both in Australia and New Zealand
they have found a battery of measures like that, together with
other options such as registering people thereby ensuring they
cannot get further credit facilities, clamping vehicles, taking
away people's right to drive, looking at more fixed penalties
if necessary. TV and vehicle licence evasion accounts for something
like 27% of all fines. Maybe they are suitable for fixed penalties.
There is a range of measures which will require legislation which
we can look at to broaden the range of penalties which is available
to that progressively as well as improving the system we have,
we actually have a more sensitive range of penalties which magistrates
can reach for.
9. I am actually shocked by this report. I guess
I knew intuitively that the situation was not very good but it
is quite shocking how poor our collection rates are, is it not?
(Sir Hayden Phillips) The payment rate has hovered
around 60% rather persistently for a while. We clearly want to
get that up. We set a target that this year it should reach 68%
and I hope that with the extra £10 million of resources we
put into the enforcement budget, we will stand a chance of positioning
ourselves to make a real breakthrough here.
10. Are you able to say whether you are going
to achieve the 68%?
(Sir Hayden Phillips) We have been to every magistrates'
courts committee in the country. They set out what they wanted
to use new resources for. We have been able to meet every bid
in full. They have their own targets and it is now down to them
to deliver the results. I can go into great detail about the practical
things which need to be done, but there is a chance here that
this could work and we could gradually begin to see a change in
the pattern. Having said that, one does actually have to take
account also of the number of penalties which are cancelled. I
am not talking about write-offs here, just having an overall look
at performance on a rolling basis.
11. I am trying to understand the mathematics.
It strikes me that there are two or three separate processes by
which this money disappears from the accounts and I want to try
to understand where the 60% and 68% derive from. I note in my
own area, West Yorkshire, the figures we have show that £11.7
million of fines were paid but £7.6 million were either written
off or cancelled. That is quite a shocking figure for the people
of West Yorkshire. Could you explain briefly the difference between
the write-offs and the cancellations? On what basis is something
(Sir Hayden Phillips) There is a whole series of reasons
why you can do it. If someone is committed to prison because they
have defaulted on a fine, it is cancelled. If they are in prison
for another offence, it is cancelled. If the penalty is remitted
in whole or in part because of a chance in circumstances, when
that is done that can be cancelled. If a conviction or sentence
is set aside, it is cancelled.
12. How is a decision taken to cancel a debt?
(Sir Hayden Phillips) By the court. It is a judicial
decision. It is not just unenforceability; this is a whole series
of categories where cancellation is required.
13. Is the figure of 60%, going up to 68% we
hope, calculated after the cancellations have been removed or
is it a gross figure rather than a net figure?
(Sir Hayden Phillips) The statistics keep away the
issue of cancellations and write-off from the 60% figure, which
is simply the amount of money collected in any one year against
the impositions made in that year. It is crude, but I am told
it is the clearest and simplest thing we have been able to produce.
14. The figures in Appendix 1 do not make sense.
They do not add up to anything like 100% on page 26 of the report.
I imagine what is happening is that we are saying the 60% is a
netted figure after we have written off and cancelled debts, is
(Sir Hayden Phillips) My understanding is that the
payment rate is as I have described. It is not, as it were, infected
with the cancellation or write-off rates. It is simply the collection
in any one year of fines, set against the amount imposed in any
15. Can the C&AG just confirm that is the
(Sir John Bourn) Yes.
(Sir Hayden Phillips) Taking one year with another,
you are right to say that you have to take account also of the
cancellation rate and also of the write-off rate. What you want
to see is the payment rate going up and the write-off rate coming
down and that is where we are beginning to be more successful.
16. Looking at West Yorkshire again as an illustration
rather than taking a constituency issue, the cancellation rate
is the second highest in the whole country at 35% of all fines.
In some areas there is no cancellation of any kind and many of
them are less than 10%. I accept that there are differences in
culture and background and socio-economic status and all the rest
of it, but a villain is a villain whether they are poor or not.
I do not really accept any defence in terms of socio-economic
status. Why should it be that the cancellation rate should be
several hundred % higher in some areas than others? Why is West
(Sir Hayden Phillips) I do not know the answer as
far as West Yorkshire is concerned. What you can get in these
figures is a relatively small number of relatively high flyers
which then distort the position. That is made clear in the NAO
report. I would have to go back and look at the West Yorkshire
position in some detail and ask them why it was made up in the
way it was.
17. Is it each magistrates' bench which does
the cancellations or is it the magistrates' committee or the clerk
to the magistrates. What is the actual mechanism for cancellation?
(Sir Hayden Phillips) The cancellation is done by
the relevant court in any particular magistrates' courts area.
18. So in my case it might be Pontefract magistrates'
(Sir Hayden Phillips) It might be.
19. Has anybody bothered to look whether beneath
the sub-regional level, that is West Yorkshire, Nottinghamshire,
there are big differences between one magistrates' bench practice
(Sir Hayden Phillips) In terms of cancellation I am
sure we could get those statistics and the West Yorkshire magistrates'
courts committee can be asked to give you an analysis of that.
We have not tended to concentrate on that so much as on write-offs
because write-offs tend to be the area where enforcement is possible
but has not occurred, whereas cancellations are automatic and
they are required by law.
1 Ev 26-27 Back