Business
Driver fury as parking ticket debt firms record ‘disproportionately high’ 63% profits
Companies that charge drivers fees for recovering parking ticket debts are operating with an average profit margin of more than 60 per cent, a Government document has disclosed.
The Ministry of Housing, Communities and Local Government (MHCLG) stated that this figure indicates a “market failure”, while the AA branded the margins “disproportionately high”.
Debt recovery agencies are employed by parking operators to pursue payment for unpaid tickets, often adding up to £70 in additional fees per ticket for drivers.
These charges were set to be banned when the then-Conservative government introduced a code of practice in February 2022, but this was withdrawn four months later after a legal challenge by parking companies.
A new consultation document setting out the current Labour Government’s proposed code stated the £70 cap is “likely to be higher than can be reasonably justified” but it is “seeking further evidence”.
It added that recovery agencies have “an average profit margin of approximately 63 per cent”.
This is “comparable to highly innovative companies” despite the businesses involved providing “standard services such as payment plan provision”, according to the document.
It continued: “We therefore do not consider them to be providing significantly innovative services, and as such the high profits may be indicative of these firms having too much control over the market, thereby indicating that there is a market failure.”
Parking operators can take drivers to court if they continue to resist paying for tickets.
The MHCLG said debt recovery agencies would break even with fees of approximately £26 per ticket, if the proportion of those paying was stable.
Jack Cousens, head of roads policy at the AA, said: “The 63 per cent profit margin feels disproportionately high for the services provided.
“This only highlights the need to curb the sector and ensure balance for all.
“There remains an overzealous cohort among some private parking operators where they hand over cases to debt recovery firms for seemingly innocuous charges.”
He added that the ban on debt recovery fees in the original consultation was “the right position” and claimed the latest version “falls short of the mark”.
Steve Gooding, director of motoring research charity the RAC Foundation, said: “The profit margins revealed by the Government help explain why there are now more than 180 private parking firms buying vehicle keeper records from the DVLA so they can send demands to drivers – it’s a huge and profitable business.
“The private parking industry’s failure over time to be more open about its activities is part of the problem and its ongoing reluctance to open its books to official scrutiny shows why ministers must follow through with plans to bring transparency and independence to this sector.”
Recent analysis by the PA news agency and the RAC Foundation found 4.3 million tickets were issued by private companies to UK drivers between April and June.
That was a 24 per cent increase compared with the same period last year.
A BPA spokesman said it “strongly disputes the Government’s profit calculations” and called on it to “publish the methodology behind these figures”.
He continued: “The numbers presented are misleading and fail to reflect the reality of the debt resolution sector.”
He insisted the purpose of debt recovery fees is “not to generate profit but to act as a fair and effective deterrent against deliberate non-payment”.
An MHCLG spokesperson said: “This Government inherited a private parking market that lacks transparency and protection for motorists.
“We share their frustration, which is why our private parking code of practice will drive up standards in the industry and hold parking operators to account.
“We consulted on the current cap on debt recovery fees and will publish our response as soon as possible.”
BENGALURU: Masayoshi Son-led SoftBank Group pared its holding in Ola Electric Mobility to 13.5% from 15.6%, in what appears like a staggered exit from the electric 2-wheeler maker that was once among its marquee India bets. SVF II Ostrich (DE), a SoftBank affiliate and Ola Electric’s second-largest shareholder after founder Bhavish Aggarwal, sold 9.4 crore shares through open market transactions between Sept 3, 2025, and Jan 5, 2026, according to a regulatory filing.
Kevin PeacheyCost of living correspondent
Getty ImagesDebt charities say they are receiving an influx of calls as people worry their financial situation has slipped towards becoming unmanageable.
The first weeks of January are usually the busiest time of year for helplines following a particularly expensive period.
Advice charity StepChange said Monday was busier than any single day last year, and credit counselling service Money Wellness said a fifth of those accessing its services at the turn of the year did so between 22:00 and 03:00.
Dave Murphy is working his way out of debt and said demands from creditors could have become overwhelming, but he urged anyone struggling to ensure they asked for help – for their financial and mental wellbeing.
Money Wellness, which runs free debt and money advice services, said thousands of people had accessed its services on Christmas Eve and Christmas Day. Expanded assistance online allows people to increasingly find information outside of normal hours – including overnight.
Sebrina McCullough, its head of advice, said: “The numbers we’re seeing over Christmas and New Year are unprecedented.
“People often feel pressure to celebrate the holidays, even when money is tight, and our data shows many are turning to us late at night when they feel most anxious.”
Pressure of priority bills
StepChange’s website had 3,958 visitors on Christmas Day, and 15,401 on New Year’s Eve and 1 January combined.
Many may have simply been exploring their options, but calls came in thick and fast at the start of the month. While not at the level of the energy crisis of a few years ago, call numbers were notably up on last year.
The Money Advice Trust, which runs National Debtline, said the first working days of January had seen more calls than last year.
Monday was the busiest single day in its history, when 1,365 calls came in.
Concerns are particularly acute for those struggling to pay priority bills such as council tax and rent.
The colder weather could also place extra strain on vulnerable households, with £4.4bn already owed to energy suppliers following a period of high prices, although the government’s cold weather payments have been triggered in many areas.
Charities are urging anyone whose debt has become unmanageable to seek help as soon as possible, rather than making matters worse by ignoring the situation.
That is a view shared by Dave, who has managed to work his way out of difficulty.
A few years ago, he found his previously manageable credit card debt becoming a problem when he was unexpectedly made redundant at the same time as going through a divorce.
“They were two quite dramatic things in six months,” said Dave, who has previously spoken to the BBC about his debt issues.
“The debt was around £20,000 to £25,000 at its height. It became so overwhelming. You feel that you are letting creditors down because you want to do what they ask of you – but you are scared, you are renting, and at times you struggle to get through each day.
“Once you are in a spiral, it is really hard to get out of it.”
He is now working in insurance, his debts are manageable and being paid off, and he said he wanted to help others “to show that you can get through these things”.
Figures published earlier in the week by the Bank of England fuelled concerns that everyday costs were becoming harder for some households to manage without turning to borrowing.
The data showed that credit card borrowing grew at the fastest annual rate in nearly two years in the run-up to Christmas.
The annual growth rate for credit card borrowing increased to 12.1% in November, from 10.9% the previous month – the highest figure since January 2024 when it was 12.5%.
Nutrition labels on the front of food packaging should be made mandatory in the UK, according to a consumer champion.
Which? called on the Government to make the change amid what it described as an “obesity crisis”.
A “better approach” is needed to help people make healthier choices, it said.
It comes after research by the group found shoppers prefer traffic light labelling, although they said it could be improved with more prominent placing and increased size.
Traffic light labelling on food packaging was introduced in 2013 and uses green (low), amber (medium), and red (high) colours to show fat, saturated fat, sugar, and salt content, plus calories.
The system is not mandatory in the UK, although it is voluntarily used by major manufacturers and retailers.
However, according to Which? the system is used inconsistently.
It claims some shops do not include traffic light labelling, or provide it without colour coding.
Research by Which? captured insights through the mobile phones of more than 500 shoppers to find out how the traffic light system is working for customers.
A third (33%) said that the nutrition label was the first thing they looked at on the front of a pack.
People most used the traffic light system when choosing snacks (56%), dairy products (33%) and breakfast cereals (27%).
Almost half (47%) said they found this labelling easy to understand.
In focus groups, the traffic light system was the preferred food labelling option, although suggestions to improve it included making it more prominent and larger.
Which? said that people also called for making the scheme easier to understand, such as making the recommended serving size on some products more realistic and consistent.
The consumer champion is now calling on the Government to introduce a mandatory front-of-pack nutrition labelling scheme.
It said this could build on the existing traffic light system to make it work better for shoppers by bolstering consistency, making it more prominent and removing aspects people may find confusing.
Sue Davies, head of food policy at Which?, said: “The UK is in the midst of an obesity crisis and it’s clear that a better approach to front-of-pack labelling is needed to help shoppers make healthier choices.
“Which? is calling on the Government to ensure that all manufacturers and retailers use front of pack nutrition labelling, ideally by making this mandatory.
“Our research shows that people still prefer traffic light nutrition labelling, but that the current scheme needs updating so that it is clearer and simpler and works better for consumers.
“The new system should be backed up with effective enforcement and oversight by the Food Standards Agency and Food Standards Scotland, so shoppers have full trust in the labels on their food.”
In 2022, some 64% of adults in England were estimated to be overweight or living with obesity.
In November it also emerged that one in 10 children in the first year of primary school in England is obese, the highest figure on record outside the pandemic.
It is estimated that obesity costs the NHS more than £11 billion every year.
A Department of Health and Social Care spokesperson said: “This Government is bringing in a modernised food nutrient scoring system to reduce obesity.
“It’s just one element of the strong action we are taking to tackle the obesity crisis as part of our 10 Year Health Plan, which will shift the focus from sickness to prevention.
“We are also restricting advertising of junk food on TV and online, limiting volume price promotions on less healthy foods and introducing mandatory reporting on sales of healthy food.”
Andrea Martinez-Inchausti, assistant director of food at the British Retail Consortium, said: “Retailers have led the way in nutrition labelling, consistently providing advice on healthy living.
“Whether that be through the traffic light system, or other measures, the industry is fully committed to helping improve the health of their customers and are constantly looking for what will work best for them.”
Save 50% at Total Wireless, Even Without a Promo Code
PPI for RMG manufacturing in Philippines up 0.7% YoY in Nov 2025
Trump urges US oil giants to repair Venezuela’s ‘rotting’ energy industry
-
Entertainment3 days agoDoes new US food pyramid put too much steak on your plate?
-
Sports5 days agoVAR review: Why was Wirtz onside in Premier League, offside in Europe?
-
Politics2 days agoUK says provided assistance in US-led tanker seizure
-
Politics5 days agoChina’s birth-rate push sputters as couples stay child-free
-
Sports5 days agoFACI invites applications for 2026 chess development project | The Express Tribune
-
Sports5 days agoSteelers escape Ravens’ late push, win AFC North title
-
Business5 days agoAldi’s Christmas sales rise to £1.65bn
-
Entertainment2 days agoWhy did Nick Reiner’s lawyer Alan Jackson withdraw from case?