March 2013

Scotland’s Eviction Party

24th March 2013 0 comments

Alex Salmond has said he will support SNP Council's who adopt a no eviction policy for bedroom tax arrears. The SNP have also said that if Scotland vote independence they will kick out the bedroom tax.

I may be cynical, but, there is something amiss here.

The Scottish Government oppose the tax;
They accept a no eviction policy is desirable;
They accept that it is possible to differentiate between bedroom tax arrears and other arrears.

So why won't they change the law so that its not possible to evict people who have bedroom tax arrears?

Its within the Scottish Parliament's power to do so.

The cynic in me believes they are playing a game. A game where Scotland's nine SNP councils will now implement a no bedroom tax eviction policy and this will be used to attack other councils that don't.

However, even if all Scotland's Council's act, this will not prevent tenants in housing associations facing evictions. Also we need to look at the substance of the decisions councils make. Dundee Council for example, has only said it won't evict those who genuinely cannot afford to pay the bedroom tax.

This means some council tenants in Dundee may indeed still face action to evict them for bedroom tax arrears, because Council bosses believe they can in actual fact afford to pay £12 from their £71 per week. Many tenants may be deemed to not be trying hard enough.

The Scottish people are being failed. They are being failed by the Scottish Parliament, the Scottish Government and many Scottish politicians who will not take a stand to support their constituents.

This is despite nearly 5,000 people signing the petition calling for the law to be changed (almost as many who responded to the national conversation) and many civic Scotland organisations supporting the call also, including Money Advice Scotland, Shelter, Oxfam and the STUC.

Maybe its just me, but this is a depressing situation and its hard not to be cynical about the calls by the Scottish Government for more powers. If the Scottish Government won't listen to the Scottish people, why should they listen to them.

Why the SNP won’t remove the threat of eviction

10th March 2013 0 comments

Margaret Burgess, Scotland's Housing Minister, has said she will not prevent Bedroom Tax evictions.

The reason: she doesn't believe the cuts will result in evictions.

If that's true then why not just remove the threat of eviction from those affected by them?

The reason why she won't is simple: neither the SNP or Margaret Burgess want the threat of eviction to be taken off the table. They don't want benefit claimants to decide whether they should eat, pay the heating or pay the £12 per week from their other benefits towards their rent.

And that's the brutal truth of these cuts and the SNPs unwillingness to remove the threat of eviction. Some will be faced with evictions, but many instead will voluntarily disconnect their gas or electricity or go hungry and this is in a country where already one in six children go hungry according to Save the Children Scotland.

So in a nutshell, the real reasons why section 16 of the Housing (Scotland) Act 2001 will not be amended as proposed by Govan Law Centre is the threat of eviction is too important.

These cuts may be made in Westminster, but they are going to be enforced in Scotland using Scottish laws and the SNP know this, as does Margaret Burgess, an ex Citizen Advice Bureau Manager of 20 years from East Ayrshire.

Ultimately, this is the true shame of the SNPs inaction to date. They understand exactly what they are doing, or not as the case is, and the Minister has the experience to know exactly what she is doing.

This inaction would be more understandable if other action had been taken, such as proposed by Shelter, like making £50 million available in the next year to compensate social landlords, but none is being taken.

It's certainly possible action could be taken.

Already the SNP have found £40 million to protect Scots from 10% cuts to Council Tax Benefit. Would this money not be better spent protecting the more vulnerable from housing benefit cuts? It may still mean people would accrue debts, but not the type that could leave them on the street.

These are indeed difficult times and difficult decisions have to be made. Unfortunately, the SNP don't appear able to make those decisions, or if they can, they are making the wrong ones.

In the long run people will blame the Tories for the Bedroom Tax, but I suspect they will also blame the SNP and when they are evicted in Scottish courts using Scottish laws, it will be hard not to see their point.

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Morally Bankrupt Law Reform

12th March 2012

Following the Scottish Government’s consultation on bankruptcy law reform, Alan McIntosh argues that the proposed reform is motivated by a need to find additional revenue raising sources for the Accountant in Bankruptcy, and the end result will be some of the poorest in our society paying more.

The Accountant in Bankruptcy, Rosemary Winter Scott, has called for Scotland’s bankruptcy laws to be rebalanced to recognise the importance of creditors, stating “compared to other countries, Scotland is “very debtor friendly. These comments echo the views of her predecessor Gillian Thompson, who once called Scottish MSPs debtor friendly.

Her comments have been supported by John Hall, Council Member of R3 the insolvency trade body who has stated we have “believed for some time that the pendulum has swung too far in favour of the debtor in Scottish Bankruptcy cases.

However, the Scottish Government’s Consultation on Bankruptcy Law Reform does not fundamentally propose changing two of the most significant debtor reforms of the last twenty five years: the one year automatic discharge and the widened access for consumers.

And there lies the problem for those that want to portray Scotland as a refuge for debtors: their arguments don’t stand up. It’s certainly true that levels of personal insolvencies in Scotland are higher than elsewhere in the UK, with 0.38% of those eligible using it, compared to 0.22% elsewhere, but Scotland’s law on bankruptcy have never fundamentally changed over the last 100 years: debtors still have to pay what they can afford and estates are wound up for the benefit of creditors.

There is, however, an ideological change taking place. Public funding of the Accountant in Bankruptcy’s office is now at a 20 year low, and the agency is operating with less than 30% of the public funding it had 2 years ago. With up to 40% of cuts this year, following on from 37% last year, these are not simply austerity measures: they go further and deeper than necessary and are politically motivated by the idea that debtors should pay more, even the poorest.

In their plans the AIB have announced they want to establish a Financial Health Service, but despite the name of this new service suggesting we will soon have a NHS for debtors, it will be nothing of the sort. If it was then we would all being paying at the point of NHS delivery and the poorest would be paying most.

Fifty-three per cent of all Scottish bankruptcies are debtors who qualify for the low income, low asset route (with the majority either wholly dependent on social security benefits or reliant on income based benefits) Significant number above that only just don’t meet the qualifying criteria. Most will be living in household and families suffering from fuel and child poverty. Yet the AIB want to raise the cost of going bankrupt from £100 to possibly as much as £700, despite the fact Citizen Advice Scotland have already criticised the current application fee as being out of reach for many or a severe cause of hardship.

They also want to change the way debtor contributions are calculated. Without even referencing the current law, contained in s31 of the Bankruptcy (Scotland) Act 1985, they appeared inclined to introduce a sliding scale similar to that used in the earnings arrestment procedure. This could result in debtors with incomes of £96 per week, who may be spending £20 of that on household fuel, having to pay £25 per month. It could also result in the farcical situation where someone with three children and earning £30,000 per annum will pay the same as debtors on the same income with no children, despite having more ability to repay their debts.

Contributions levels, however, are controversial and the problem is not the current law that states debtors must be allowed sufficient amounts for their aliment, but the way this it is currently calculated with various figures being used across the sector. Agents of the AIB have been criticised for not allowing enough for essentials, but in their defence this has been partly driven by the funding cuts to the AIB and the agency contracts which mean agents need to squeeze debtors harder to cover their costs.

The real issue that needs to be debated is not whether Scotland’s bankruptcy laws need rebalanced, but whether the level of funding cuts to the Accountant in Bankruptcy’s office are now dangerously low and likely to result in increased hardship for some of Scotland’s lowest income families and households. There are no suggestion of redundancies at the AIBs office and considering the amount of staff they employ, the national role they perform, the number of debtors they deal with and the number of functions they perform, £2 million per year is hardly an exorbitant cost for a society that’s is heavily dependent on financial services for employment and revenue.

One cannot escape the feeling the drive to make the AIB fully self funding is driven by hubris, but at what cost? A bankruptcy system that’s goals will be distorted by the needs of the agency that operates it and a Financial Health Service dependent on life support financed by Scotland’s poor and most indebted. That’s a system that will be morally bankrupt from the outset.