The New
Debt Arrangement Scheme
MATRICS would like to thank both the Scottish
Government and the Accountant in Bankruptcy for
their continued support and funding
Policy Objectives of DAS
• Enable people to resolve serious debt problems
in a dignified way;
• Reduce the need for creditors to take legal
action to recover their debts;
• Extend the benefit of money advice to those
people who have a particular need for it;
• Improve the quality of money advice, through
training money advisers;
and
• Minimise the impact of bad debt on both debtors
and creditors.
Need for Reform
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Take up-lower than expected
Coverage across Scotland-not uniform
Post code lottery
Some areas-more chance of seeing Nessie
Creditor participation-very low
but
Working for those who can access it
Protects the debtor’s home
Protects against diligence
Powerful tool for money advisers
Key changes-Overview
New regulations SSI 2011 No 141 intend to:
• Widen the Money Advice Gateway.
• The DAS Administrator will take over the
ongoing administration of DPPs from free sector
money advisers.
• New Computer system accessible by Money
Advisers, creditors, payments distributers and
the DAS Administrator
Key Changes - Overview
• Introduce a payment holiday of six months
for debtors experiencing a reduction in
disposable income by 50% or more.
• Introduce Joint DPP for couples where
they have a joint and several debt liable.
• Introduce Single debt DPP but not
appropriate when debtor paying under a
Time to Pay Direction or Order or a Time
Order.
Key Changes - Overview
• Debtor must make first payment under the DPP
within 30 days of approval
• Debtor must complete and submit tax or duty
returns when due
• DAS Administrator will automatically revoke a
DPP if the debtor grants a trust deed and it
becomes protected
• Where Joint DPP revoked and debtor applies
within 21 days for DPP in own name creditors
cannot add interest, fees or charges – Reg 4
DAS (Fees) Regs 2011
The Advice Gateway
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More individuals can be approved to be DAS
money advisers. These include:
Existing approved money advisers.
Qualified insolvency practitioners. an employee
given authority by that insolvency practitioner.
A money adviser for an organisation which is
accredited at Type 2 level or above against
Scottish National Standards for Information and
Advice Provision;
Advisers working for a citizens advice bureau
Local Authority money advisers
Under Reg 9 DAS regs 2011 DAS Admin
satisfied fit and proper person to be a money
adviser
The Advice Gateway (contd)
Benefits of the proposed changes:
• Debtors will continue to receive face to face
advice.
• Solution to the 'postcode lottery'.
• More advisers can offer DAS.
• Less administration for free sector advisers,
meaning advisers are freed up, to see more
clients.
• Increased debt options for debtors
• Holistic approach to debt solutions
The Application Process
The debtor:
• Cannot apply for their own DPP
Free sector
• Can use the services of a private
DAS application
Debtor advice
or free sector Money Adviser
The money adviser:
Private sector
• Completes an application form which
is sent to the DAS Administrator (via the system).
• A fee charging money adviser must inform the debtor
that advice and access to DAS is free elsewhere.
The DAS Administrator:
• Records the application In the DAS Register (allowing
protection earlier)
• Submits the proposal to creditors (for free sector
applications)
The DAS System
• DAS Administrator will administer all free sector DPPs.
• Private sector DPPs will be administered by the private
sector money adviser
• All DPP administration will be conducted on the DAS
system
• Creditors will log in to the system to consent or refuse
proposals.
• DAS Administrator will supervise the process and make
F&R decisions where appropriate.
• Notices will be generated from the system regardless of
the party conducting administration.
• A side project will be run to create a database of creditors
Payment Distribution
• The regulations have changed so that AiB
have to conduct a tender exercise to
approve payments distributers
• The DAS Administrator will charge an
application fee which is 2% of sum
distributed to creditors – collected by the
payments distributers
Approved Payments Distributers
Benefits:
• Appointed through open/transparent
tender exercise
• Better service-reduced costs to creditors
• Charge a maximum of 8%
• More competition through competitive
tender for distributers.
• Tendering contracts will ensure the best
returns for creditors.
Approved Payments Distributers
The AIB has awarded contracts to:
Carrington Dean,
Begbies Traynor,
MLM and
Gregory Pennington now Think Link
To be the payments distributers
Debt Arrangement Scheme Hub
(DASH)
• Dedicated web portal
• Access to case management system
• Able to check status of cases
through
www.dasscotland.gov.uk
The DASH Computer System
DEBTOR
Free Sector
adviser
Private Sector
adviser
DAS/DPP
Application
AIB/DA admin
in free sector
Dual
routes
Self admin in
private sector
AIB/DAS
Proposals to
creditors
Accept?
Computer
Administration
Reject?
Fair & Reasonable
Test applied
DPP approved
Payment
Distribution to
creditors
Accept?
System
Reject?
DPP falls
Future help and support may be found at:
AIB Helplines:
Open from 9:30am to 4:30pm Monday to Friday. Tel:0300 200 2770
Fax:0300 200 2601
Post
DAS Administrator Accountant in Bankruptcy 1 Pennyburn Road Kilwinning
Ayrshire KA13 6SA
or
Money Advice Consultancy Service:
T: 0845 123 2326
E: consultancy@matrics.org.uk