The Scottish Government response -

• The Scottish Government is very grateful to the Forum members for the time they invested in these very important deliberations
• The Scottish Government recognises that there will be areas where interested parties will have a different viewpoint but grateful that Forum members were able to consider constructively the matters brought to the table
• The Scottish Government advocates the importance of free comprehensive money advice and acknowledges the valuable work carried out in the money advice sector
• The Scottish Government recognises the responsibility it has to take prompt action where it can to help the Scottish people particularly in this time of economic difficulty
• This has already been demonstrated by the response announced to the report of the Re-possessions Group and by the announcement of additional funding to provide advice
• Specifically in regard to the matters considered by the Forum the SG will take forward at the earliest legislative opportunity proposals to :-

- extend the protection currently offered for the family home in bankruptcy to incorporate the same protection to debtors who have entered a protected trust deed

- where the sheriff has consented to the sale of a family home, extend the period for which the sheriff may postpone that sale from 1 year as at present to 3 years taking into consideration all relevant circumstances

- introduce a requirement, similar to the provisions of s11 of the Homelessness etc. (Scotland) Act 2003, for trustees in bankruptcy and trust deeds to notify the local authority of the sale of a family home

- allow the exclusion of specified assets, in particular family homes, from protected trust deeds. This provision would not change the fundamental nature of a trust deed nor undermine the creditors ability to oppose a proposed trust deed

- extend the debt relief offered by bankruptcy to some who can not presently meet bankruptcy criteria by allowing a certificated route in a way that is fair and open and not subject to abuse

- render it incompetent to attach (and in consequence exempt from vesting in bankruptcy) any vehicle, the use of which is reasonably required by a debtor, the value of which does not exceed £3,000 (this amount is currently set at £1,000)

- encourage debtors who become bankrupt to take responsibility for their on-going commitments by introducing a new ground for bankruptcy restrictions

- remove the requirement for trustees to advertise awards of bankruptcy in the Edinburgh Gazette and allow interested parties free access to the Register of Insolvencies

• The Scottish Government wholeheartedly supports the recommendations made in the 'Access to Advice' paper submitted to the Forum for its consideration
• The Scottish Government will ask the Accountant in Bankruptcy to review her guidance to trustees in bankruptcy and trust deeds to recommend liaison with local authorities where a family home is to be sold
• The Scottish Government will ask banks to do whatever they can to provide access to basic banking facilities for people who are bankrupt
• The Scottish Government continues to have concerns regarding lending protocols and debt collection practices and will do what it can to make representation to UK Government in this reserved area. SG recognises the action already taken by the Office of Fair Trading to investigate debt collection practices
• The Scottish Government appreciates there are some issues which must be considered by a wider cross section of interested parties. We acknowledge the importance of building consensus on important and far reaching issues which impact on individuals and businesses in Scotland. We must ensure our debt solutions provide protection from abuse by the unscrupulous yet offer fairness where needed. We must ensure that those who can meet their commitments continue to do so and most importantly we must ensure that people who are struggling to deal with unmanageable debt are protected against the threat of unnecessary homelessness.

We will therefore issue consultation on the following matters:-

- whether the voting rights for creditors in trust deeds should be amended to limit the ability of a minority of creditors to prevent the protection of a trust deed

- whether the Accountant in Bankruptcy should have some form of advice giving role. This could allow AiB to offer a view on the appropriateness of a particular course of action and recommend full engagement with money advice

- whether the Accountant in Bankruptcy should, in some circumstances, be able to act as trustee in protected trust deeds

- what changes, if any, might be appropriate to the way in which the family home is treated in bankruptcy