04 Jun 2021

Arrears in the time of COVID-19

As our year end performance figures were calculated, I got a WhatsApp message from Katherine, our income services manager on my week off telling me our end of year rent arrears were in.


I was gob smacked. I knew our arrears performance was going to exceed target of 3%, but I was unprepared for how well the team would do. A feat made more impressive considered against the COVID context, with a stay on evictions and reduced customer incomes via furlough and redundancy.

I have put together some observations and reflections on how we amended our income practices, in the hope that something here might help you in your quest to reduce arrears.


From the start of the pandemic, like many organisations, Greatwell Homes resolved to contact customers who we identified might need additional help to check on their welfare each week and see if they needed any extra support. We applied this thinking to our income contacts, asking customers first how things were going and how they were coping in the pandemic before we turned the conversation to the rent account. Unsurprisingly, this drew out more open conversations with customers. Similarly, our letters and notices were revised to embrace a more supportive tone rather than refer to the risks of non-payment.

Behavioural economics

We have been experimenting with behavioural economics (or nudge theory) for a few years and learned that simple (and subtle) changes to written correspondence can deliver positive outcomes in terms of payments and engagement from customers.

‘Nudge: Improving decisions on health, wealth and happiness’ by Thaler and Sunstein is an engaging and informative read on the subject.

Little nudges are often cost-neutral and can deliver significant improvements to performance and customer engagement. 

Segmenting debt

I bet you have some stubborn ‘low level’ cases that you cannot enforce via the courts? During lockdown, the team segmented these smaller debts and made contact using the principles outlined in my first two observations above and were successful in getting payments from customers. The thinking behind this is that we could get £10 from a static debt using the same energy as getting a £5 payment off an account with an SPO. Over the year, these payments (that we would not normally expect to receive) added up over time.

No court? No problem?

As eviction and enforcement channels were restricted for most of 2020/21, we noted that officers were being more determined with some of their debt, and more willing to look for solutions whereas before they might have referred these more troublesome cases into court or a warrant. Whilst this is more of an anecdotal reflection, it is something we are looking at more closely for the year ahead.


There are plenty of software packages and bolt-on applications to your housing management software that seek to predict payment patterns and recommend accounts for action out there. We have worked with one provider for this purpose and found that it has increased officer efficiency, and increased payments.

This year we have invested in an additional piece of software that brings customer calls to us, rather than income officers trying (and sometimes failing) to get hold of customers in debt and initial feedback has been encouraging.

In a similar fashion, we have developed an algorithmic approach to tenancy failure by looking at all our ‘failed’ tenancies over the last five years and segmenting them by the protected characteristics that we collect. This has created a ‘risk profile’ for new customers, and we ensure that our service from both our housing and income teams responds to this increased risk of tenancy failure. Again, there are products on the market that can deliver a much more sophisticated approach to this and I would recommend having a look to see what is out there.


The last point I would raise is around performance. During lockdown we analysed the key areas of risk to the business in the pandemic, and unsurprisingly arrears were one. We created bespoke CPI’s (COVID performance indicators) for our incident management team to review. This meant that I was looking at arrears data on a weekly basis, rather than monthly which permitted more pro-active and timely changes to service delivery.

For the year ahead we have created new performance measures for staff, including targets for low level and static debt and customers paying by direct debit to deliver increased performance across a wider scale of issues. As I mentioned earlier, segmenting debt, payment methods and so forth might yield improved collection rates or efficiencies in income recovery.

In closing, we know that the Government has responded to the sector positively on how we have limited evictions over the last year and I am sure ministers will look for similar outcomes in a post-pandemic environment. I hope there is something in here that helps you on your arrears journey and help reduce evictions.

Written by Chris Holloway

Chris Holloway is a CIH fellow and head of head of housing and support services at Greatwell Homes.