The Scottish Social Justice and Security Committee have timeously published their final report into the problem of Low Income and Debt in Scotland (Robbing Peter to pay Paul: Low
income and the debt trap).

The Committee, which launched its enquiry in November 2021, and has been taking evidence from stakeholders and other interested parties over the last 8 months, has now published it’s recommendations.

These include:

• A call for the Scottish Government to use all of Scotland’s devolved powers to help tackle the cost of living crisis, particularly for disabled adults and children
• For the UK Government to accelerate its plans to bring forward secondary legislation to control the emergence of Buy Now Pay Later credit as a growing area of debt.
• For the UK Government to reflect on how Universal Credit is exacerbating the finances of those on low income and contributing to a rise in debt.
• For the Scottish Government to undertake a full review of the Scottish Welfare Fund and ensure it is adequately funded.
• For new national guidance to be developed to cover the collection of publicly owned debt and for clear guidance and processes to be created for disputing liability for public owned debt, including council tax.
• A tightening up of pre-action requirements for evictions in the private and registered social landlord sectors, with greater emphasis on promoting money advice.
• For COSLA to work with local authorities to develop a national policy in relation to the collection of school meal debts, that has regards to human rights and removes stigma.
• For the Scottish Government to work with Local Authorities to agree 3-year funding plans for Money Advice, that does not detract from the need for core funding of services.
• For increased funding to be made available for money advice services.
• For the Scottish Government and Local Government to ensure that everyone has access to face to face, online and telephone advice.
• For there to be increased access to free Wi-Fi and computers through libraries.
• For more training to be provided to health care professionals to raise awareness of debt issues and the importance of advice.
• For the Scottish Government to bring forward a mental health moratorium for people struggling with debt and to ensure that people will not be charged by mental health professionals for completing a Debt and Mental Health Evidence form. This would bring Scotland into line with the rest of the UK.
• For bankruptcy fees to be removed for anyone who is found to have no disposable income.
• For the minimum debt threshold for Bankruptcies to be removed and for the time a party must wait before they can use the Minimum Asset Procedure again to be reduced to five years from ten years.
• For the Protected Minimum Balance for Bank Account Arrestments to be increased to £1,000 from £566.51 (this measure has already been implemented and will now commence from November 2022).
• For Creditors to be allowed the flexibility to reduce, with the agreement of employees, the level that Earning Arrestments are taken from wages.

The full report can be downloaded here.