Figures from a recent Credit Services Association (CSA) report reveal consumer debt has soared with a total of £32 million awaiting collection by their members. Together with consumer debt sold to debt buyers this equates to the equivalent of £1000 of referred debt for every person in the country. Parents of children in private education are not exempt and many are struggling to meet the rising cost of private school fees.
Daniels Silverman, one of the country’s leading credit management and debt recovery agencies have seen a steady rise in schools seeking help with fee management. Numerous prolonged periods of late payment have a significant impact on cash flow and it is important to address the issue of unpaid and overdue fees early.
Carole Hughes managing director of Daniels Silverman Limited says “We recently conducted a survey of private education providers to ascertain how the recession is affecting their school. 50% confirmed the current academic year is proving financially tougher than the last one (Sept 2010 to June 2011), and the majority (3 out of 5) expected this academic year (from Sept 2012) to be even harder financially. A staggering 86% confirmed that parents were expressing concerns about their ability to fund private education for their children in future.”
It is important that schools have clear admission policies and terms and conditions that deal with non payment of fees and clear notice periods in the event a parent needs to withdraw a child from the school. Parents can be extremely embarrassed when their financial circumstances change, and the school may be the last to know. By taking action at the first sign of default and engaging the services of a professional credit management and collection agency, this can be avoided, and affordable repayment plans agreeable to both school and parents can be put into place and closely monitored.
Legal action should be viewed as a last resort after all other avenues have been explored due to the time and expense involved.