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Press Release: Protected Trust Deeds – Improving the Process
Press Release: Protected Trust Deeds – Improving the Process18 May 2012
The Scottish Government today publishes a report summarising responses to the protected trust deeds consultation and with it, lays out its actions to improve this debt relief tool by making it a more effective, viable option for people in Scotland struggling with debt.
Running from October last year to January, the consultation – ‘Protected Trust Deeds – Improving the Process’ sought the views of stakeholders and public on recommendations to make the current trust deed process more efficient, fit-for-purpose and help ensure that protected trust deeds achieve the best balance between the needs of debtors and the rights of creditors.
In 2010, a group of experts from across the debt and insolvency sector formed the Protected Trust Deeds Working Group (PTDWG) who were tasked, by the present Minister for Energy, Enterprise and Tourism, Fergus Ewing MSP to evaluate the current protected trust deeds process and make recommendations for improvements to this debt relief option.
Proposals in the consultation looked at standardising the processes where possible and improving the levels of information available to debtors and especially creditors.
Minister for Energy, Enterprise and Tourism, Fergus Ewing, who has responsibility for personal debt and insolvency in Scotland said:
“The Scottish Government understands that by enhancing the protected trust deed process to ensure that it effectively balances the needs of indebted individuals and their creditors, it will not only assist in the financial rehabilitation of individuals but will also help strengthen Scotland’s growing economy.
“I welcome the publication of this report and anticipate that recommended measures will help ensure that this debt relief mechanism offers an effective, appropriate option to individuals struggling with debt.
“I am grateful to all those who took the time to contribute to the consultation”
The outcome of the consultation has been published today along with the Scottish Government’s formal response which outlines a range of actions it will take forward as a result. These actions include the introduction of a new PTD Review Board, the implementation of Accountant in Bankruptcy’s Protected Trust Deed Guidance and the amendment of statutory Protected Trust Deed Forms.
• The ‘Protected Trust Deeds – Improving the Process’ public consultation ran from 17 October 2011 until 31 January 2012 and received a total of 49 responses from the public.
• Trust deeds are a formal voluntary debt solution where the debtor makes an offer to put what they can afford towards paying as much of their debt as is possible for a fixed term. Where the offer is accepted by creditors, the trust deed becomes protected and is then known as a Protected Trust Deed. This means that interest on the debts is frozen and creditors cannot pursue their debt further through legal action.
• The Protected Trust Deeds Working Group (PTDWG) was Chaired by Rosemary Winter-Scott, Chief Executive of Accountant in Bankruptcy (AiB). The PTDWG comprised of a cross-section of stakeholders from the advice sector, creditor organisations, insolvency practitioners and AiB officials. Details of the working group including membership, minutes and papers can be found via AiB’s website.
• Full information including the consultation report and the Scottish Government’s response can be viewed via Accountant in Bankruptcy’s website.