5 Apr 2020

Social services ask for halt of debt collection and fees so families can survive

3:11 pm on 5 April 2020

Utility, housing, banking and finance companies are being asked pause disconnections, debt collections and waive penalty fees as people struggle to pay their bills during the Covid-19 lockdown.

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Photo: Supplied

Making the pleas in an open letter, 15 social service organisations also called for a moratorium on debt collection and late payment fees imposed by central and local government.

"Covid-19 is causing immense disruption to our society and our economy. Hundreds of thousands of New Zealanders and their families now face having to survive on a reduced income," the letter said.

"These people are worried about whether they can pay their rent or their mortgage, while keeping their homes warm and keeping food on the table."

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Essential services companies such as energy, telecommunications and internet, banking, finance, insurance and rental housing, should take "additional steps" to support their community during the Covid-19 crisis, it said.

The group had three key requests:

  • No disconnections or service cessation. Companies should continue to offer their services without interruption.
  • Waive penalty and late fees, including additional interest charges. No one should pay extra while they are struggling to pay bills on time.
  • Pause debt collection. People should not be pursued by debt collectors during this time.

While some providers had already taken some of those steps, the group wanted to see "coordinated industry-wide commitments to do the right thing by people, their families and whānau."

"We are calling on all essential service providers to publicly commit to implementing these minimum relief measures. Businesses and governments should not hesitate to go further."

Christians Against Poverty chief executive Aimee Mai said it was now more important than ever that essential services and money lenders had compassion for New Zealanders facing hardship.

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"As Covid-19 hits home, applications for high-interest loans are increasing amongst people with low credit scores. Some are seeking loans just to buy food," she said.

Citizens Advice Bureau chief executive Kerry Dalton said it was vital that providers of services people could not do without "do their bit and be socially responsible."

"They need to ensure that those whose income has been hit hard by the COVID 19 crisis continue to receive their essential services without this increasing hardship through debt or penalties."

The 15 signatory groups on the letter are: Age Concern, Child Poverty Action Group, Christian Budgeting New Zealand, Christians Against Poverty, Citizens Advice Bureau NZ, Community Law Centres of Aotearoa, Consumer NZ, FinCap, Good Shepherd NZ, Methodist Alliance, New Zealand Council of Christian Social Services, Nga Tangata Microfinance, NZ Council of Trade Unions, Social Services Providers Aotearoa and The Salvation Army.

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