Gas company hires debt collectors
For many years, rent dodgers and other debtors had quite an easy life in the Czech Republic. Being in state hands, utility companies during the communist regime were reluctant to collect debts. The situation started changing after 1989 with the arrival of the free market, yet it took several years after the collapse of communism before people who owed large sums of money on rent, electricity and gas began feeling pressure to clear their debts. While town halls resort to moving rent defaulters to bare, unequipped flats at city outskirts or to confiscating property, the Prague gas utility Prazska Plynarenska hired a firm specialising in debt collecting. Jan Velinger spoke to company representative, Dagmar Hartmanova:
The Prague Gas company has recently begun relying on uncommon last measures to get problematic customers to pay off outstanding debts, they have gotten pairs of debt collectors to go door-to door, clients are essentially given a chance to pay up their debt - in cash - or have their gas cut off. Now, why is it that the Prague Gas company has resorted to such measures? Were unpaid debts getting out of hand?
"The Prague Gas company naturally has to take into account its own profit and viability. By collecting debts we are hoping to improve the timing in which our customers pay their bills. Basically, though, we try to collect payments that our customers owe us throughout the year. This is the second time we are taking this kind of action, it is a kind of appeal to our customers to realize that even natural gas has to be paid for."
Can you tell me which companies do the actual collecting?
"One is a debt collecting company which we have contracted and two are connected to our company, because the individual that is collecting debt has to not only be economically competent but also has to know the technical aspects of the natural gas system. The people are trained as natural gas technicians so in certain situations, if the bills are not paid, they will be able to disconnect the individual from the gas network."
In terms of the collectors, what kind of rights have they been given? How have they been told to behave, for example, at the scene?
"Of course they are very polite as well as assertive. I have to say that we have not had any negative feedback. Through the media people became aware of the fact that we are doing this, so people came to us on their own accord and paid their debts."
I am assuming that all the customers are informed well in advance
"All of our customers received a letter warning them that they had unpaid bills. The letters also stated the date when they could expect our collectors."
If the collectors do take the decision to cut off the gas, legally do they need customers permission to actually enter their flats?
"Basically it works like this: either the owner of the apartment will let our technicians in or he wont. In the event that he doesnt, there is also the option of disconnecting the natural gas from outside the apartment."
Could you give me a rough estimate on what percentage of customers pay up at the last minute, and the number of those whose gas is truly cut off?
"If we can take into account our operations last year we contacted six and a half thousand customers and we collected 12 million crowns. We expect similar results in this years program. Let me also add that the number of people that were disconnected last year only numbered in the dozens and we are expecting similar results this year."
How does your company deal with customers who are, say, in financial trouble? Old people for instance, who are on a pension, who are behind on payments and who claim they simply dont have the money. Is it possible for them to come to some kind of long-term agreement with your company to eventually reduce their debt, without having their gas cut off?
"This option does exist, as long as the customer shows an interest in paying his bills. It is possible to make an agreement on a long-term repayment of debt. I must add, however, that the majority of people who are on social benefits, lets say retired people, most have their bills in order. I had a situation where an older women who was 85 years old said that all her bills were in order, just that had spent four months in the hospital and her son was supposed to take care of the bills that somehow were never paid. In a short amount of time everything was sorted out. There is no problem when people are truly interested in paying off their debts."
Do you think there is a trend in the Czech Republic not paying their debt, maybe some left-over from communism?
"My personal opinion is that it a leftover from communism, where everything was free. On the other hand inconsistency on the part of companies in collecting debt was also socially damaging before 1989; basically, if you didnt pay than nothing really happened. We try to collect money that people owe us, and although our campaign is not necessarily viewed as a positive thing, people must understand that it is totally normal to pay. If I buy bread I also have to pay for it and the same goes for natural gas. So yes, the tendency not to pay is a certain communist leftover."
