Thames water and debt relief order.

Dandare74 · 14 July 2021 at 10:49AM

I have just been approved for a debt relief order and my Thames water utility bill is included for £227 I was am not in any arrears and get my full bill yearly and pay it monthly I pay £23 a month, I am a little confused if I have to continue paying it or not or do I wait for the new annual bill?

Platespinner123 · 14 July 2021 at 1:11PM

Hi,

I suggest you check with the DRO intermediary who submitted the application, but in some cases the whole year's liability can be included in a DRO. If the debt was included in the DRO then it is subject to the 1-year moratorium.

The Debt Relief Order A-Z says this:

Water rates

The treatment of unpaid water rates will [depend on? words missing!] the provider’s charging regime.

Where water is supplied under a charging scheme that is rate-based rather than metered, the charging scheme may provide that standing charges are due and payable in advance.

In these circumstances the whole of that year’s charge, or unpaid balance at the date of the DRO, may be scheduled in the application, in addition to any arrears.

It is the responsibility of the approved intermediary and debtor to establish the water company’s terms and where the full amount for the year may be scheduled, it should be scheduled.

Many water authorities include an “insolvency clause” which they state allows them, upon the making of a DRO, to divide their water charges before and after order.

You should, where appropriate, continue to schedule the full years’ water charges in a DRO application. The debtor should be informed that an insolvency clause may exist within a water authorities charging regime. If that is the case, then the water authority may divide their charges and issue a revised water bill for services provided subsequent to the making of the DRO.

Charges for metered supplies are treated differently as the meter should be read at or about the date of the DRO and the amount to be scheduled in the DRO based on that reading. New charges will become payable as water is used.

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What might happen next

Thames Water might challenge the full debt's inclusion in court, or issue you a new bill - but until they do, you don't need to make any payments.

If you do receive a new bill for the remainder of the year, this could be challengeable - but equally it could be a hassle to do so, so it's your choice.

I'm aware of one legal case where a bill for the remainder of the year after a DRO has been (successfully!) challenged, and that was one where, unlike you, the client had not taken advantage of the an instalment scheme. This mean that the full debt was 'due' on the 1st of April of the relevant year. I am not sure whether entering into an instalment scheme like you have changes the date that the debt is due, or just permits you to pay the debt after the due date; that might depend on the exact wording of your contract.

Hope that's helpful!

Dandare74 · 14 July 2021 at 1:18PM

That’s great thank you very much.

Dandare74 · 18 July 2021 at 8:28AM

Hi platespinner123 you responded to one of my posts regarding Thames water I have found this information on their website.

insolvency.

if you enter any type of formal insolvency bankruptcy Iva debt relief order we will calculate any charges you owe on a daily basis up to the day that the relevant insolvency procedure takes effect ( the insolvency date ) these charges will be managed in line with the relevant insolvency procedure.

Charges that apply after the insolvency date will not be included in the insolvency procedure. This means that you as the occupier of the property will be responsible for paying the charges that apply from the next day after the insolvency date.

Platespinner123 · 20 July 2021 at 10:43AM

Dan & I had a DM conversation about this, but I thought for future reference (and to show I didn't ignore him!) I would put my response here too.

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First response

What they're saying is that they will ask you to pay the proportion of your bill that matches how much of the year was left when you applied for your DRO. Say your annual bill was £400, and you applied for the DRO on July 1st, three months into the year. They would say that 1/4 of the bill (about £100) was included in the DRO, but that you still need to pay the other £300.

So at some point they are likely to send you a new bill for charges covering the period from the date of your DRO until March 31 2022.

Until they do that, you don't need pay anything (because you don't know how much you need to pay!) - but if you're worried, you could give them a call and check with them.

There is an argument that Thames Water's policy about this is unlawful, at least in some cases. I don't know if this would apply to your situation. If you want to test this, you should speak to your DRO intermediary (if they're not sure, they should have access to specialist services that can look into it further).

But even if they agree you have a case, challenging it could be a pain - you might need to ask a court to decide. You might be able to find a Law Centre who can help for free (Google 'Law Centres Network' - I'm still too new to post links).

Hope that's helpful!

Second message - Dan said his online account was showing an outstanding balance

Because your account shows an outstanding balance, they might have already produced a bill or a statement for that amount (I'm not 100% certain - you could always call them and just ask if they will be sending you a revised bill after your DRO). If they have, then if you don't pay it they could take further action like getting a CCJ.

Although you might have a defence against that, as I say, I'm not certain of any success - so I'd really suggest you either continue making your monthly payments if you decide it's not worth the fuss, or speak to your DRO intermediary about whether you can try to challenge Thames Water and argue that you don't owe this outstanding balance.

There's a bit more information on that challenge in an old MSE post by fatbelly - search "Water debts in a DRO - interesting take from CAB". If you speak to your DRO intermediary (or another advisor), it could be a good idea to send them that post as well, as they may or may not already be aware of that case!