Using behavioural insights to increase contact with tenants in rent arrears in Wigan

Wigan Council's Collections team used behavioural insights to encourage tenants who were in arrears, and who had not been in contact with the Collections team, to get in touch and access support. The team sent a one-page letter to tenants – written with an empathetic tone emphasising support rather than arrears and rent collection, and featuring a single call-to-action. Laura Melling of Wigan Council reflects on the project.


We found that 19 per cent of tenants initiated contact with the council after the letter was sent (compared to less than one per cent in the period before the letter was sent). We concluded that letters provide more value for money than home visits, as long as the expected contact rate, as a result of the letter, is higher than six per cent.

The challenge

During the COVID-19 pandemic, proactive rent collection among Wigan Council housing tenants was paused. The longer a tenant goes without paying rent, the more likely it is that their debt level becomes difficult to repay and therefore unsustainable. If a tenant who is struggling to pay rent gets in touch with the Collections team, a rent officer can offer support directly or refer them to specialist support services. Therefore, this project focused on using behavioural insights to encourage tenants who were in arrears who had not been in contact with the Collections team to get in contact for support.

The solution

The solution consisted of sending a letter to tenants who were struggling to pay rent and had not recently been in touch with the Collections team. Targeting the intervention at this group of tenants had two advantages: it meant the intervention could be tailored to the needs of this group, and it allowed us to explore the value of sending a letter to tenants that are not actively in touch with the Collections team already. The letter sent to tenants was designed to incorporate several behavioural insights that aimed to address the barriers to people seeking help when they are struggling to pay rent. The letter had the following features:

  • short – the letter was designed to be on a single sheet of paper, with all key information on the front page.
  • single call-to-action on the front page – the front page of the letter asked the recipient to contact their rent officer to access support.
  • empathetic tone – the letter used supportive language and emphasises that support is available.

The impact

To evaluate the value of sending the letter, we analysed data relating to the outcomes of tenant-initiated contact (our main outcome measure), being offered support by rent officers, and average rent arrears before and after the letter was sent. We found promising levels of engagement across two out of three outcome measures, with a strong response in our main outcome on tenant-initiated contact:

  • 19% of tenants initiated contact in the six weeks after the letter was sent (compared to less than one per cent before the letter was sent)
  • 3% of tenants were offered support by Rent Officers in the six weeks after the letter was sent (compared to less than one per cent before the letter was sent)
  • the average rent arrears was £914.39 at the end of the observation period prior to the letter being sent and was £943.96 35 days after the letter was sent, which is an increase of £29.57.  

As part of our evaluation, we also ran a value-for-money analysis where we mapped the cost per contact for letters against three estimates of the cost per contact for home visits. This comparison shows that letters provide more value for money than home visits as long as the expected contact rate as a result of the letter is higher than 6 per cent.

19% of tenants initiated contact in the six weeks after the letter was sent (compared to less than one per cent before the letter was sent)

How is the new approach being sustained?

Due to evictions being suspended nationally until the end of May 2021, we were unable to resume our recovery framework so the letter was done as an adhoc exercise but once we get the go ahead to resume normal processes corporately we can review the letter for a potential support letter again as we restart our collections and recovery frameworks on rents.

Lessons learned

Based on the findings from this project, we recommend that the Collections team should:

  • consider incorporating additional behavioural insights in future letter design, for example by revisiting the standard page of support offers to better address the risk of choice overload
  • continue to analyse contact rates for different communications, outreach methods and target populations. Analysing value for money across initiatives will help the collections team identify and iterate cost effective approaches for reaching different groups of tenants.
  • explore why, of those who contacted the collections team, only a fraction were offered support (This may also give insight into limitations of our findings and evaluation design. For example, if the target population included monthly payers – which it wasn't meant to – perhaps some tenants contacted the collections team to flag that they were not struggling to pay rent and did not need support.)
  • look into what other factors may have driven the slow down in arrears build up among rent accounts in the target population (This could be because there was a high number of rent accounts in the target population that were applying to Universal Credit in the pre-letter period and got behind on payments, or there was something unique about either the pre- or post-letter period that would have affected transactions (such as the pre-period being around Christmas, and arrears historically increase more during that period).

Contact

Laura Melling
l.j.melling@wigan.gov.uk