Clean Slate founder Jeff Mitchell explains why we must engage struggling households during lockdown to minimise the financial fall-out from Coronavirus and how small incentives might be all that are needed

• Community engagement falters on anything but food during lockdown
• Debt time-bomb ticks as rent, bills and debt repayments deferred
• Join us to achieve quick wins, engage residents to access preventative money help

Who doesn’t like a quick win? A deal or, best of all, something for nothing is a principle offer in the best marketing campaigns. We’re primed to look out for them. Red labels on prime-position supermarket shelves draw us to aisles we don’t usually browse. And day-time TV, catering for the un- and under-employed, titillate with homes doubling their value under the hammer, old tat making hundreds after an upcycle and ads featuring postcode lottery winners. It’s the British Dream.

During lockdown, that dream has faded. People are sitting tight and fighting the good fight by cheering on the NHS and letting Covid-19 victims take priority over everything. People are not coming forward to get potential symptoms of cancer checked, for example. And likewise, the numbers of callers to community hubs that were set up around the country as an emergency response to support people experiencing issues around housing, mental health, domestic abuse or work and money, have been much lower than anticipated. “I’m not an emergency,” people are saying. Maybe quick wins are what will help prevent longer-term harm to big parts of our community.

There are quick wins and there are win-wins. And, for partners in East London and Southwark (so far), we have an offer that is both: We’re offering ready-funded support, we just need you as a partner. By referring your residents, tenants or service users, you can help us help you by helping them swerve the impending financial chaos. The time is now for avoiding the crippling cost of increased evictions, debt recovery and the resulting homelessness, mental ill-health and substance misuse.

INFLUENCING CHOICES

For a few years, I’ve researched how behavioural theory can inform how we engage hard to reach communities. We found that what started intuitively, recruiting ‘graduates’ of our support and training as peer workers, and designing Quids in! magazine more like Take A Break than Money Advice Service advice guides, was a good start.

Reading MINDSPACE, a kind of ‘how to’ guide recently updated by the Institute for Government on “influencing behaviour through public policy”, I discovered we had gravitated to ways that appealed to ‘people like us’. By bringing people together to share their money tips, not only did it make them feel less alone in their struggles, we nurtured taking control of money as a ‘norm’. 

Quids in! has a tone of righteous indignation that starts to speak to incentives and FOMO, (fear of missing out). Our cheeky article, 10 Reasons the Rich and Powerful Don’t Want Us Online, actually spelt out the benefits of checking our bank balance and switching utility supplies, but it hit home by suggesting someone might be profiting from us not doing so. Then there’s content appealing to participants’ ‘ego’, a call to arms: Would more people accept help if we stopped advertising foodbank hand-outs and called upon communities to help keep food out of landfill, as a kind of civic duty? And similarly right now, can we draft in the unemployed as a new crop-picking land army, as delivery workers protecting those who are shielding, and in retail keeping the country fed?

But how do behavioural economics work when people are in lockdown? Another report, Wired for Imprudence, by the RSA, asks why so many people make poor financial choices. Its findings are consistent with MINDSPACE but when we think about principles of ‘cognitive overload’, ‘overconfidence’ and ‘instant gratification’, there are clues to what is going on right now and how to tackle it

THE DEBT TIME BOMB

With messaging in mind, I was conflicted about the government’s three-month eviction embargo because I felt sure many hard-pressed tenants would de-prioritise rent. The ‘let’s just get through this and worry about the consequences later’ message was reinforced by mortgage holidays and even the furlough scheme. It’s probably the best strategy, but for people whose financial mindset I’ve been studying for over ten years, I know it’s a set-back. We’re telling people to dig in, let the sick and dying go first, and bury our heads in the sand. Rent, bills and debt payments will be deferred. For debtors, it’s the worst strategy.

There are positive reports that debtors repaid over £3.8 billion of personal credit in March. This made me pause for thought. But then I realised this could only apply to those with a decent disposable income that continued to come in as they work from home, with nowhere else for it to go. That doesn’t apply to low income households just scraping by. And it sure as hell doesn’t apply to those who were self-employed, freelance, on zero hours contracts or recently made redundant, who are suddenly in shock at navigating and living on welfare. There is no doubt in my mind that there is an unprecedented debt time-bomb waiting to go off post-lockdown.

INCENTIVES PILOT

This month Clean Slate launched a pilot incentive offer for residents of Southwark, Tower Hamlets, Hackney and Newham. Using social media and working with referral partners, we aim to attract up to 150 low income households and vulnerable people to take our money health-check. During a 45-minute phone call, we’ll run through an accessible ‘quiz’ to identify the strengths and weaknesses of their money habits and pick out a small number of actions that could help them reduce their spend and increase their income. If they need specialist help or financial advice, we’ll signpost them on as a matter of urgency. We’ll then keep in touch to see how they’re getting on and guide them through any hiccups. For taking the health-check, they’ll receive a £10 shopping voucher.

In 2018, when Clean Slate first expanded its remit from employment support to helping people become better off through money skills, finding work (or better work) and getting online, we helped people increase their income by an average £594. True, we were working ‘in the room’, one-to-one and in workshops, but we believe we can achieve similarly striking results working remotely. The issue is engaging people.
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Ironically, the £10 shopping voucher will probably prove a bigger draw than £600 of increased budget. It’s a quick win, achieved in less than an hour, for the effort of two phone calls: One, to us, to set it up, plus a call-back from us to work through the health-check. It ticks the ‘instant gratification’ box and meets an immediate need around food in the context of lockdown.

WHAT CAN I DO?

We want to add as many partners to our referrals list as possible. For landlords, authorities and support agencies, the debt time-bomb is a worst-case scenario. Increased evictions, debt recovery and the resulting homelessness, mental ill-health and substance misuse (already on the rise during lockdown) will have crippling costs attached. You can refer to us now but let’s make it official – contact [email protected] to set things up.

• Phone 020 3540 7421
• Email   [email protected]
• Web     cleanslateltd.co.uk/london

If your work is outside of the four pilot boroughs, let’s talk about expanding the offer. Let’s face it, if we’re having to work remotely, we could be working from anywhere. And in fact, in terms of capacity, Clean Slate has teams linked up by a virtual switchboard, on hand to take calls across the UK.