Debt and Insolvency Services Stakeholder Forum
MINUTES OF MEETING
Thursday 13 June 1013, 13:00 – 14:00
Atlantic Quay, Glasgow (Meeting Room James Watt A)
Present:
Rosemary Winter-Scott (Chair)
Claire Orr
John Cook
Charlotte Barbour
Antoinette Eaton
Alex Irvine
Maureen Leslie
Yvonne MacDermid
Angus McIntosh
Mike Norris
Martin Prigent
Colin Soulsby
Melanie Taylor
Derek Wilson
Accountant in Bankruptcy (AiB)
Accountant in Bankruptcy (AiB)
Accountant in Bankruptcy (AiB)
Institute of Chartered Accountants of Scotland (ICAS)
Lloyds Banking Group
Society of Messengers-at-Arms and Sheriff Officers
(SMASO)
MLM Consulting representing IPA
Money Advice Scotland (MAS)
Scottish Association of Law Centres (Castlemilk Law
Centre)
Max Recovery
TDX Group
Royal Bank of Scotland
Think Money
Institute of Chartered Accountants of Scotland (ICAS)
In Attendance:
Katherine Crisp (Acting Secretary)Accountant in Bankruptcy (AiB)
Nicola Robertson (observer)
Accountant in Bankruptcy (AiB)
Amy Johnston (observer)
Accountant in Bankruptcy (AiB)
Item 1
Welcome, introduction, apologies and acceptance of previous minutes
and matters arising from previous minutes.
1.
The Chair welcomed all members and observers to the meeting and invited round
table introductions. Apologies were received from Andrew Douglas, John Hall, Alex
MacDermott, Kevin Mackay Euan MacPherson, Susan McPhee and Anne Muir.
2.
The minutes of the previous meeting were accepted as a true record.
3.
The following updates were provided on the outstanding action points.
APs 1 & 2: An update was provided that there had been discussions with SMASO around
the issue of calling-up notices. Some concerns were raised over creditors adopting the
practice of going straight to the extractor without serving papers through a Sheriff Officer.
Policy responsibility for this issue rests elsewhere in Scottish Government and it was agreed
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that this action should be passed to colleagues if SMASO can provide appropriate evidence
of current practice.
AP 3: Clarification was provided that this will not be an issue. Contributions would not be
taken from universal credit.
AP4: On agenda for discussion.
AP5: Some information had already been provided to AiB and will be looked at through the
DASH review forum. Other DISSF members to send list of desired information to AiB.
AP6: If AiB identified examples of this practice they would refer to OFT if appropriate.
No outstanding action points
Item 2
DISSF Brief Paper ; DISSF(13-14)01
4.
An overview of the Q4 stats within the DISSF briefing paper was provided. The
figures will be provisional until validated. Trust Deed numbers showed an 11% drop, and
sequestrations showed an ever greater decrease across the year. The figures also
demonstrated an increase in the number of people using the certificate for sequestration
route which has partly accounted for the drop in the number of people using the LILA route
into bankruptcy.
5.
An update on the upcoming DAS marketing campaign was provided. Following the
success of the first campaign in 2012 a second one, to coincide with the changes to the DAS
regulations, is planned for this summer.
6.
There was an update on the completion of the Corporate Plan. It had been published
on the website and hard copies would be distributed once available.
Action Point : AiB to provide DISSF members with a hard copy of the Corporate Plan when
it is published.
7.
An overview of the annual Stakeholder events was presented. Events would be held
in Glasgow, Edinburgh and Inverness in the late autumn. Workshops would be organised
based around the Bankruptcy Reform Bill and the DAS and PTD regulations. DISSF
members were asked to volunteer to chair the closing panel session.
Item 3
Legislation update including: DAS and PTD regulations & Bankruptcy Bill
8.
It was confirmed that the new DAS regulations were laid in Parliament on 20 May
2013, they are due to be debated in a Committee on 19 June and will come into force on 2
July, subject to Parliament agreement. The main changes were outlined.
9.
An update on the introduction of The Bankruptcy and Debt Advice (Scotland) Bill was
provided. The Bill was introduced to Parliament on 11 June. Policy change around the
period of acquirenda was discussed as this had changed from one year to four years.
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10.
A number of improvements have been proposed to Protected Trust Deeds (PTDs) and
the new regulations should commence autumn 2013. There would be a removal of the
requirement to advertise the trust deed in the Edinburgh Gazette, instead it would be
published on the Register of Insolvencies.
11.
The Common Financial Tool (CFT) working group has not met for a couple of months
in order that AiB could conduct research into the two current tools. The new requirement for
48 monthly payments means that ensuring the level of contributions are sustainable is very
important. There was discussion about what figures would be adopted and it was explained
that detailed analysis had been carried out and a recommendation would be put forward
regarding which tool would be used. The tool would apply to all statutory solutions in
Scotland. A question was raised as to how the tool would be utilised if trigger figures were
outside normal parameters and it was confirmed that AiB would need to endorse any
situations like this as consistency must be maintained. This would be discussed with the
working group and detailed guidance would be produced.
12.
The initiative undertaken by the Money Advice Trust and Step Change Charity to
potentially develop a single tool for the calculation of surplus income was discussed. A
question was asked around whether the new tool would be adopted in future as its outcomes
would likely differ from the current models. In response, it was explained that any new tool
would be examined once it is developed. Confirmation was provided that the figures used in
the CFT calculation would be reviewed annually.
13.
There was a further query on how the CFT would be promoted prior to the Bill
commencing and this would need to be considered. Organisations would also need to think
about the systems required. Communication would be key so the industry would be ready for
all of the changes.
Item 4
Money Advice Service’s debt advice quality framework
14.
The question was asked as to what discussions had taken place to recognise existing
accreditation and whether further accreditation would be required. An explanation was given
that no further accreditation would be required as the Scottish National Standards were very
rigorous and there was a lot of favour for the model in place in Scotland. A response to the
consultation would be produced.
Item 5
Regulatory issues including: Updates from ICAS, IPA, etc. and DAS
inclusion in any regulatory monitoring process
15.
It was agreed that a regular update from IPA should be a standing item on the agenda
for a verbal report.
Action Point : IPA and ICAS to provide an update at next meeting.
16.
To improve transparency on the performance of individual companies, it was
confirmed that AiB will publish, as part of its annual report and accounts, Form 7 returns at
the conclusion of trust deeds in terms of dividends payable and costs incurred. The data has
currently been sent to Trustees for validation. The Scottish Government’s position was that
data collected should be published continuously rather than waiting for FOI requests.
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17.
There was a discussion on the regulatory issue of DAS inclusion in the monitoring
process and whether RPBs were looking at DAS cases when reviewing the IPs’ caseload or
only insolvency cases. It was discussed that the approach to regulation should be consistent
across all bodies and that IPs should be monitored as a whole across all their work. The
AiB’s view is that IPs are able to undertake the DAS work as a result of being an IP, hence
their IP assessment should look at their DAS work. It was noted that some IPs were starting
to build up a DAS portfolio. If the trend continues to grow it may need to be subject to a
separate review.
Action Point : JC to provide information to ICAS members who are active in DAS.
Item 6
approval
Debtor Issues : Freezing of bank accounts and Payday lending post DPP
Freezing of bank accounts : AiB staff have reported that debtors were not clear that
their bank accounts could be frozen once they had entered into bankruptcy. Thought was
given to how the correct advice should be communicated to people.
18.
19.
Action point 4 from the previous meeting was then discussed and an explanation was
given that no action was required as we already advertise bankruptcies on a public register
which creditors can access.
Payday lending: There was some concern that people in approved DAS DPPs were
continuing to access credit through payday lenders. When in DAS, debtors are unable to
access credit without informing creditors of their DPP and may only do so in prescribed
circumstances. If there has been no disclosure, this may lead to the revocation of the DPP.
Additionally it was confirmed that the DAS regulations prevent creditors commencing any
diligence to recover debt incurred after approval of the DPP where the creditor has failed to
comply with the lending restrictions prescribed in the regulations. .
Action Point: All DISSF members to advise AiB of any instances where debtors have
entered into a payday loan post DPP so that any trends can be identified.
Action Point : DAS review board to look into this and review trends in order to target advice
and discussion.
Item 7
AOB
20.
It was noted that Lloyds Bank had been approached by some organisations querying
whether they would be willing to include them into a fair share contribution scheme.
Action Point : AE to provide more information to John Cook.
21.
The continuing misuse of the DAS register was discussed. Concerns persist that
information obtained from the register is being used to generate leads for alternative debt
solutions. It was pointed out that access to DAS had changed and 2 pieces of information
were required to be able to use the Register. It was also noted that there had to be a balance
to protect both debtors and creditors.
Action Point : DISSF members to advise AiB of any organisations who are adopting this
practice so AiB can investigate.
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22.
Information was provided that since April a specific local authority has seen a 40% rise
in rent arrears due to the bedroom tax. In some areas there was a 50% rise. There is the
potential that ultimately these increased levels of debt may lead to increased insolvencies.
23.
The next meeting will take place on 8 October 2013, at Victoria Quay, Edinburgh.
24.
The Chair thanked all members for attending and closed the meeting.
Katherine Crisp
Acting DISSF Secretary
June 2013
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