Christians Against Poverty call for better debt arrangement schemes

Christians Against Poverty (CAP) has written to the Accountant in Bankruptcy (AiB) to make some recommendations on debt arrangement schemes.

Christians Against Poverty call for better debt arrangement schemes

The charity is worried debt arrangement schemes (DAS) don’t set the right pace for a statutory debt repayment scheme in England and Wales – although it supports the breathing space scheme that has held prominence in industry discussions.

CAP has written to Accountant in Bankruptcy (AiB), who administer the scheme on behalf of the Scottish Government, to make some recommendations on how to make DAS a simpler, more accessible and more straightforward process.

It has also created a briefing paper on the matter to ensure the public is aware of what is going on and can support the scheme.

The charity said DAS is a fantastic tool and is pioneering in the statutory protections it offers to those repaying debts, but it is concerned DAS does not provide debt relief for those with multi-complex needs.

It added: “In practice, it leaves room for more collections, reassignment and enforcement than expected and there is a risk that those in vulnerable situations face further anxiety and financial consequences that worsen their situation.”

The briefing paper explains how Scotland is leading the way in facilitating the repayment of problem debt through a statutory debt management plan (DMP).

It points out that while the legal protections are strong, more flexibility is needed to ensure the scheme achieves its intended outcomes and provides an accessible route out of debt for those in severe financial hardship.

CAP said this is especially vital as the rest of the UK looks to learn from Scotland’s range of debt solutions.