Protected trust deeds: consultation on proposals for legislation changes

Ministerial Foreword

Scotland has earned international recognition for the progressive and far-sighted debt solutions that have been put in place. We have a system which aims to balance the needs of those struggling with unsustainable debts while ensuring those that can pay their debt do pay their creditors.

Scotland has three statutory debt solutions – bankruptcy, protected trust deeds and the Debt Arrangement Scheme. The Debt Arrangement Scheme is the UK's only statutory debt management scheme that can protect the family home and other assets and prevent further action from being taken by creditors. We are also the only part of the UK to have implemented a moratorium period to provide those that need it, some breathing space and time to seek advice about the right solution for them.

I recognise though that we must continue to ensure that our debt solutions continue to be suitable for those who need them. The Scottish Government is committed to continuously improving our legislation and value the feedback we receive from stakeholders. This is vital to help shape policy and ensure that solutions continue to be effective.

As part of that, the Scottish Government is reviewing our protected trust deed legislation. A protected trust deed is a voluntary but legally binding agreement to repay part or all of your debts. It is a form of insolvency and can have significant consequences, impacting on a person's credit rating and ability to get further credit, and can lead to bankruptcy if the terms of the agreement are not met.

This document asks for feedback on our draft proposals which aim to bring improvements to this statutory debt solution.

I look forward to hearing your views.

Jamie Hepburn MSP
Minister for Business, Fair Work and Skills