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  • Millie Corless, Data Analyst, Registry Trust

Thursday, 27th January 2022

2021 monetary judgment data insights: What they mean for household and business finances in 2022

Many believed the pandemic would be over by now, but with new strains of the virus elongating the social and economic process of recovery, Registry Trust’s latest quarterly and annual monetary judgments data for the UK & Ireland reflect a still-to-recover society.

The data compiled from the Register of Judgments, Orders and Fines in 2021 shows a year not seen before; one attempting to return to normality but failing in the wake of the Covid-19 economic crisis.

The complete report, dashboard and statistics book, plus press releases for each jurisdiction, on our full year and Q4 2021 data are available on the Registry Trust website, but here is a summary of some key insights and what they mean for household and business finances in 2022:

Increases in the number of monetary judgments compared to 2020

As expected, the number of monetary judgments registered increased in 2021 following a plummet in 2020 created by the onset of the pandemic due to forbearance measures and court closures. Although registered judgments increased in 2021, they continue to remain below pre-pandemic levels. This shows the gradual process of a return to normality, with the current trend largely following that of the post-2008 financial crash. As forbearance measures are completely removed, borrowing returns to pre-pandemic levels, and the impact of the current cost of living crisis is felt, we expect the number of judgments registered in 2022 to continue to increase. However, we hope that lessons can be learnt from past mistakes about how to protect and support financially vulnerable households as part of the economic recovery, as we highlight in our latest report.

Differences in judgment numbers and values across UK & Ireland jurisdictions

Our monetary judgments data is broken down into the different geographical jurisdictions for which we maintain Registers – England & Wales, Scotland, Northern Ireland, Republic of Ireland, Jersey, and Isle of Man. We can also drill down further into Local Authority areas which provides us with useful insights that can be used for locally targeted policy interventions. A stark contrast between jurisdictions seen in our 2021 data was the large decrease in judgments in Jersey and the Isle of Man compared to 2020 versus the large increases elsewhere. This indicates that consumers and businesses in these areas are being shielded from the economic impact of Covid-19 more so than those in England & Wales, Scotland and Northern Ireland. The number of judgments against consumers in the Republic of Ireland decreased slightly in 2021 compared to 2020 but the value of the same increased significantly. Decrees against Scottish businesses also fell, suggesting that the country is doing a better job of supporting them in recovering from the impact of Covid-19 than elsewhere.

Decrease in monetary judgments registered in December

When looking at data from across the year, it’s easy to miss seasonal fluctuations. For example, a reduction in the number of monetary judgments processed in December is common not just in 2021, but annually across our annual data records. There are various possible reasons for this, including claimants winding down for the festive season therefore not chasing money, or the courts having reduced turnover due to festivities resulting in fewer judgments being processed. This reduction in judgments nearing the end of 2021 is not representative of improved consumer or business finances, supported by the sharp increase in judgment seen in January each year. For this reason we often warn against complacency when looking at end of year figures.

Reduction in the number of monetary judgments being marked as ‘satisfied’

The number of monetary judgments that were marked as ‘satisfied’ on the Register of Judgments, Orders and Fines in 2021 was 2% lower than that of 2020, despite more judgments being registered. 199,948 satisfactions were registered in 2020, totalling 20% of the total judgments, satisfactions and cancellations. In 2021 this number decreased to 195,926, totalling just 16% of total judgments, satisfactions and cancellations. This reduction is likely the result of tighter household and business finances leaving fewer individuals able to repay their debts. But it could also be the continuing lack of awareness amongst consumers and businesses that it is currently the responsibility of the defendant, and not the claimant, to notify the courts of proof of payment. This is concerning and an area where we have been calling for change. In fact, it’s one of the key calls to action in our latest report, mentioned above.

Although 2020 and 2021 have been unprecedented years due to the pandemic, the general pattern of gradually rising numbers immediately following a crisis is similar to what happened post-2008. We will continue to assess the trends and patterns of our judgment data throughout the year, and it will be interesting to see how economic recovery progresses in 2022.

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